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Drop in US durable goods orders reflects volatility in Boeing aircraft orders - ING

FXStreet (Łódź) - According to James Knightley from ING the decline in US durable goods orders by 18.2% in August can be attributed to the volatility in Boeing aircraft orders.

Key quotes

"So stripping out the transportation component we find that orders were up 0.7% MoM."

"There was also good news in the non-defence capital goods orders (excluding aircraft) component, rising 0.6% MoM while July’s figure was revised up 0.3 percentage points."

"This is a positive story as the series tends to be a good lead for where investment spending is heading and therefore suggests that this key component of GDP will continue to make a significant positive contribution to growth."

"On the GDP front, recent revisions to data series suggests that tomorrow’s 2Q final figure will be revised higher, possibly close to 5% from the 4.2% rate previously reported."

"As such, the spare capacity in the US economy continues to shrink which is why we expect the Fed to start tightening policy from April."

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