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The dollar value of orders for durable goods was higher in June, but that bit of bright news may be mostly because of the surging inflation that drove up prices and sales of defense aircraft. Bryan Mena reports in The Wall Street Journal that despite some signals of continued momentum, the economy is showing signs of a slowdown. He writes:
Overall orders for durable goods—which include factory equipment, computers and washing machines—increased in eight of the past nine months through June.
The data reflect both continued demand from businesses and consumers and rising prices. Orders data isn’t adjusted for inflation, which is running at a four-decade high.
Ian Shepherdson, chief economist of Pantheon Macroeconomics, wrote in a note that the strength of durable-goods orders last month “will reverse, in part at least, in July.”
The latest figure “does not change the bigger picture of a slowdown in spending, but it has not reached recession-type proportions,” Mr. Shepherdson said.
More broadly, the U.S. economic momentum has shown signs of easing this year after robust growth in 2021.
Economists surveyed by The Wall Street Journal estimate the economic output expanded at a 0.3% annual rate in the April through June quarter, after gross domestic product contracted at a 1.6% annual rate in the first quarter. Second quarter GDP data will be released Thursday.
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