US Factory Orders Unexpectedly Tumbled In July As War-Spending Tumbles

With Manufacturing surveys signaling a slowdown in the US economy, analysts expected US factory orders to grow at just 0.2% MoM in July (and overall durable goods orders unchanged), but they were way off as July factory orders tumbled 1.0% MoM and June was revised down from +2.0% to +1.8% MoM…

Source: Bloomberg

That is the first drop in factory orders since September 2021 and biggest drop since the peak of the COVID lockdown crisis in April 2020

The main driver of this disappointment was a lack of war-buying – Defense Aircraft and Parts tumbled 49.7% MoM after spiking 78.3% MoM last month…

Source: Bloomberg

Need moar war!

Of course, this nominally-priced data series is a little misleading given the surge in prices over the past year or more and so perhaps it’s better to see what actual manufacturers are saying about their new orders…

Source: Bloomberg

Is today’s tumble the start of that mean-reversion we saw in 2008?