CIBC Research discusses its reaction to today's US durable goods report for the month of September.
"Headline US durable goods orders were stronger than expected in September but the details revealed a dimmer picture. Headline orders advanced by 0.8% (vs. -1.5% expected), while ex-transport orders rose by a mere 0.1%, in line with our forecast, but slightly below the consensus. While aircraft orders were down, transportation overall was up a modest 2%. Core capital goods orders edged down for the second consecutive month although the three-month average annualized pace is a healthy 8.5% (down from 11% in Q2). Separately, the advanced goods trade balance widened marginally but unexpectedly, reaching a record $76 billion in September, with both exports and imports rising moderately. Finally, wholesale inventories rose by a below-consensus 0.3% while retail inventories edged up by 0.1%.
Given the widening of the trade deficit and the slight disappointment in core durable goods orders and inventories, that could see expectations for tomorrow’s GDP print fall slightly," CIBC notes.