MNI DATA ANALYSIS: US December Factory Orders Rise 0.1%>

--Factory Inventories Flat; Business Inventories Tracking +0.6%

By Shikha Dave and Harrison Clarke

     WASHINGTON (MNI) - The value of new factory orders rose 0.1% in 

December, well below the 0.9% increase expected by analysts in an MNI 

survey and the Bloomberg consensus for a 0.8% gain, data released by the 

Commerce Department Wednesday morning showed. 

     Durable goods orders were revised up to a 1.2% gain from the 0.1% 

decrease reported in the advance estimate. Nondurable goods orders down 

1.0% on declines in petroleum and coal products, beverages, and food 

products. Nondurable goods new orders are equivalent to nondurable goods 

shipments in this report. 

     Factory orders excluding transportation were down 0.6% in the month 

following a 1.3% decline in November, interrupting the string of gains 

that stretches back for most of the past two years. Durables orders 

excluding transportation were revised up to a 0.1% gain from the flat 

reading in the advance report. 

     In addition, unfilled orders were -0.1% in December, showing 

a slight decline in demand for manufactured goods. 

--TRANSPORTATION ORDERS UP

     Transportation orders were up 3.2% in December, revised up from the 

advance estimate. The unlisted transportation components were up 3.7% 

in the month, based on an MNI calculation. 

     Nondefense capital goods new orders up by 3.4%, however they were 

down 1.0% when excluding aircraft. 

--INVENTORIES FLAT, SHIPMENTS DOWN

     Factory inventories posted a flat reading in December. In addition 

to this, the Commerce Department's advance report on inventories showed 

a 1.1% gain for wholesale inventories and a 0.9% gain in retail 

inventories. 

     While these data are eligible for revision, the levels as they 

stand now, combined with the flat reading in factory inventories, would 

result in a 0.6% gain in December business inventories when that report 

is released on March 11, an MNI calculation showed.

     Overall factory shipments were down 0.2% in the month despite a 

0.7% increase for durable goods shipments. The decline was driven by a 

1.0% decline in nondurable shipments. Nondefense capital goods shipments 

increased by 0.1%, but were flat after excluding the civilian aircraft 

component. 

     Given the mix of inventories and shipments reported Wednesday, the 

inventory-to-shipments ratio was unchanged at 1.35 from November. 

     ** MNI Washington Bureau: 202-371-2121 ** 

[TOPICS: MAUDS$,M$U$$$]