Highlights
Factory orders are moving higher, up 1.3 percent in February to more than reverse a 1.1 percent revised decline in January and re-establish their upward trend. Orders for durable goods have been the key strength of the factory sector, rising 2.4 percent in February (revised from a 2.2 percent gain in last week's preliminary release). Orders for non-durable goods, up 0.4 percent, have also been rising but much less strongly than durable goods.

Order data bounce notoriously from month to month but much less so for shipments where, unfortunately, the upward slope topped a bit in February. Shipments rose only 0.1 percent vs gains of 0.6 and 0.8 percent in the prior two months. But the February slowing is tied in part to aircraft production which surged in January. February aside, aircraft production, based on unfilled orders at Boeing and Airbus, is likely to be a key strength for this year's factory sector. Unfilled orders in general are a big positive, rising a total 1.3 percent to extend their upward slope.

Inventories are another positive for the factory sector, up only 0.4 percent in the month to keep the inventory-to-stock ratio unchanged, for the eighth time in the last nine months, at a very lean 1.33.

Weakness in Europe and slowing in China have yet to impact the US factory sector which is in good health. Yesterday's ISM report for March was solidly positive with the ISM stressing that rates of growth, though lower than the early part of the recovery, are ideal -- are sustainable.

Market Consensus before announcement
Factory orders fell back 1.0 percent in January, following very strong gains in the prior months of December at 1.4 percent and in November at 2.2 percent. Weakness is centered in durable goods orders which fell 3.7 percent (revised from the minus 4.0 percent in last week's durable goods data). Weakness here is widely spread but again follows unusual strength in prior months. Orders for non-durable goods, which always reflect price swings in commodities especially oil, rose 1.3 percent.

Other readings in latest report include a solid gain in shipments, up 0.9 percent, a rise in unfilled orders, up 0.6 percent, and a 0.6 percent build in inventories. Inventories, despite the monthly dip in new orders, are steady and lean with the inventory-to-shipment ratio unchanged at 1.33.

More recently, durables orders in February rebounded 2.2 percent.

2012 Release Schedule

Released On: 1/4 2/3 3/5 4/3 5/2 6/4 7/3 8/2 8/31 10/4 11/2 12/5 Release For: Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct