Factory Orders and Manufacturing Inventories

In many respects this report is a rehash of the durable goods release that became available a week earlier. The Factory Orders report shows the dollar level of new orders for both durable and nondurable goods. It consists of the earlier announced Durable Goods report, in addition to new data on nondurable goods orders, and is thus more complete than the Durable Orders report. Nondurable consist of food and tobacco products, which grow at a fairly consistent monthly rate. The market also watches this report for revisions to durable orders data, which can be significant. Currently, durable goods orders are 54% of total orders. The final piece of new information in this report is factory inventories, the first glimpse at the inventory picture each month (wholesale inventories are typically released a week later, with retail inventories released a few days after wholesale inventories). Though the inventory figure is not a market-mover, economists use this number to help forecast inventories in the quarterly GDP report. The Factory Orders report is scheduled for release at 9:00 (CST) around the first business day of the month by the Census Bureau of the Department of Commerce.

POTENTIAL IMPACT ON INTEREST RATES: LOW