With PMIs sinking rapidly and macro surprise indices crashing, analysts remained optimistic of a continued rise (albeit a small 0.1% MoM) in US durable goods orders in preliminary May data. It turns out they were ‘under’-optimistic as durable goods orders surged 0.7% MoM (with a small downward revision from +0.5% to +0.4% MoM in April).
That is the 3rd straight monthly increase in orders and pushes them up 12.0% YoY.
Ex Transports, orders rose 0.7% MoM – beating expectations of +0.3%.
The value of core capital goods orders, a proxy for investment in equipment that excludes aircraft and military hardware, rose 0.5% after a 0.3% gain a month earlier.
Finally, Shipments soared by 0.8% MoM – 4 times the 0.2% MoM expected.
None of this data helps the current ‘growth scare dominates inflation fears’ narrative… as ‘good news’ is now ‘bad news’.