Jan. Factory Orders Preview
Jan. Factory Orders are expected to fall 2.5% after gaining 2% in Dec.. Jan. Factory Shipments are expected to increase 1.2% after falling 0.4% in Dec.. Inventories are expected up 0.5%, which would boost the Inventory-to-Sales ratio from 1.23 to 1.24.
The anticipated drop in Jan. Factory Orders falls in line with the 5.3% drop in Jan. Durable Goods Orders. The anticipated increases in Jan. Factory Shipments and Inventories also falls in line with the durable goods report, which showed better-than-expected increases in Durable Goods Shipments and Inventories.
Jan. Non-Durable Goods Orders are expected to be nearly unchanged after dropping 0.4% in Dec. Real equipment spending is expected to increase 2% in Jan. after a 3% increase in Dec.
Potential upside to these estimates appear to be limited as factories are likely to have scaled back production in line with the anticipated US economic slowdown.