Economics Headlines , Durable goods, New home sales ripped higher last month

Economics Headlines

·         Durable goods - The March durable goods report confirmed that the rebound in capital equipment spending is marching on with pretty solid momentum. Although the headline orders number disappointed by falling 1.3%, that decline was attributable to the extremely volatile aircraft category where orders sunk 42%; the details beyond the headline were quite strong. Ex-transportation orders rose 2.8% and the core (nondefense, ex-aircraft) capital goods category saw orders rise 4.0%. More encouraging was the better data quality shipments number--core capital goods shipments were up 2.2% and February was revised from up 0.6% to up 1.5%. Today's number leaves core capital goods shipments increasing at a 7.4% annual rate in Q1 after rising at a 8.7% rate in Q4. Inventories at manufacturers of durable goods increased $0.5 billion last month, the third consecutive monthly increase. Today's number adds about 0.1% point to our estimate of Q1 GDP, taking us to 3.0%.

·         New home sales ripped higher last month, presumably stimulated by buyers rushing to get in ahead of the expiration of the homebuyer tax credit at the end of April. The 87,000 increase in the rate of new home sales to 411,000 is not the largest change in new home sales, but coming off a base that was the lowest new home sales on record, the 26.9% increase was the second biggest percentage increase in the series' history