We have yet more evidence that the US economy is slowing this morning with the release of the durable goods numbers.  Following a surge in orders in December – mostly due to aircraft orders – the Commerce department reported that new orders for January fell by $12.0 billion, or 5.3 percent. 

“New orders for manufactured durable goods in January decreased $12.0 billion or 5.3 percent to $212.8 billion, the U.S. Census Bureau announced today. This decrease followed two consecutive monthly increases including a 4.4 percent December increase. Excluding transportation, new orders decreased 1.6 percent. Excluding defense, new orders decreased 4.7 percent.”

December gains were revised lower from 5% to 4.4%.  Durable goods inventories are the highest on record. 

“Inventories of manufactured durable goods in January, up six of the last seven months, increased $2.0 billion or 0.6 percent to $322.3 billion. This was also at the highest level since the series was first stated on a NAICS basis in 1992 and followed a 1.1 percent December increase.”

Perhaps manufacturers are stocking up in anticipation of demand stemming from the tax rebate.  But, in my opinion, the credit crunch will force many conumers to allocate their refund to paying down debt and most manufacturers will never see the benefits. 

We’ll see…