We already knew the Durable Goods Orders, right? Durable goods are goods that are expected to last more than three years. It includes a wide range of items including computer appliances and industrial machinery, and trains, aircrafts and automobiles. The number of this indicator is typically changing from time to time, since there is a changing demand in transportation sector. This, will make the market price trend and inflation in raw material sector fluctuate or unstable. And as we all know, this is the weakness point of the durable goods orders.
Well, there’s another variant of the durable goods orders, named Core Durable Goods Orders. The number of this indicator is the total value of new orders for long lasting manufactured goods without considering transportation items. Since the airplane orders are very unstable, the core number can give a better measurement of ordering trends. The market actors will strongly follow the new numbers order, since this number indicates the present economic condition and also the future production loyalty in industrial sector. If the number is higher than market expectation, it could be a bullish signal for the USD. But if the number is below market expectation, it should be taken as a negative/bearish signal for the USD.
In the United States, the new orders data is collected by the U.S. Census Bureau and announced in a monthly-basis survey, called the M3 survey. This survey includes the industrial establishment with $500 million or more in annual consignments.
In relation with market, the core durable goods orders indicator has a significant role. If the measured number of core durable goods orders increases, it possibly indicates an increase in the currency of the country.
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