06272016Mon
Last updateFri, 24 Jun 2016 2pm

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U..S. Durable Goods Orders Down 2.2% in May

New orders for manufactured durable goods in May decreased $5.3 billion or 2.2% to $230.7 billion, the Commerce Department announced today. This decrease, down following two consecutive monthly increases, followed a 3.3% April increase. Excluding transportation, new orders decreased 0.3%. Excluding defense, new orders decreased 0.9%.

Inventories of manufactured durable goods in May, down ten of the last eleven months, decreased $1.1 billion or 0.3% to $382.5 billion. This followed a 0.4% April decrease. Machinery, down nine of the last ten months, led the decrease in inventories. 


Federal Judge Halts New BLM Fracking Rules

“The Obama administration will fight a federal judge’s ruling overturning its effort to regulate hydraulic fracturing on public lands,” Bloomberg reports. The White House says they will take the case to the U.S. Court of Appeals.

“The ruling, issued late Tuesday by Wyoming-based District Court Judge Scott W. Skavdahl, blocks the U.S. Bureau of Land Management (BLM) from enforcing a 2015 rule that set detailed standards for the construction of oil and gas wells drilled into some 700 million acres of federal land. Although it would apply only to acreage under the BLM’s control, it was seen as a model for states to follow as they regulate drilling on private land.” 

Markit Manufacturing PMI Rebounds in June

June data highlighted strengthening business conditions across the U.S. manufacturing sector. The seasonally adjusted Markit Flash U.S. Manufacturing Purchasing Managers’ Index (PMI) rose to 51.4, up from 50.7 in May. Relatively weak PMI readings during April and May meant that the average for the second quarter of 2016 (51.0) was the lowest seen since Q3 2009. However, the latest reading pointed to a recovery in growth momentum following the six-and-a-half-year low recorded in May. Higher output levels provided a boost to the headline index in June, alongside faster growth of new orders and employment.

The U.S. Cities Where Manufacturing is Thriving

“Grand Rapids-Wyoming, Mich., has boosted its industrial workforce by 29% since 2010 to 110,800 workers, with 5.4% job growth last year alone, placing it first on our list. This growth has been very diversified, with many specialty firms engaged not only in auto parts, but also food, aerospace and defense,” Forbes reports.

“But the big story, and the big numbers, are in the greater Detroit area, where there are roughly 240,000 manufacturing jobs. About 149,000 of them are in suburban Warren-Troy-Farmington Hills, also known as ‘automation alley,’ where the area’s industrial workforce has expanded by 30.6% since 2010.” 

Manufacturers More Optimistic on Long-Term Outlook

The National Association of Manufacturers (NAM) released the results of its second quarter 2016 Manufacturers’ Outlook Survey, showing an uptick in overall sentiment. In this survey, 61.7% of manufacturers expressed positivity about their own company’s outlook, up from 56.6% who said the same thing in March. This marks the most optimistic manufacturers have been since December 2015. Three-quarters of manufacturers surveyed consider regulatory burdens to be one of the sector’s primary hurdles. Manufacturers also continue their call for comprehensive tax reform. 

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