Durable Goods Orders
December's Durable Goods Orders data was released at 8:30 AM ET this morning, revealing a stronger than expected 2.4% rise in new orders for big-ticket products. While the headline number is bad news for bonds and rates, there are several other factors that make the data favorable. This data is known to be volatile from month to month, so the size of the variance from forecasts isn’t nearly as relevant as it would be in other reports. More importantly though, a secondary reading that excludes more costly and volatile transportation-related orders, such as new airplanes, came in weaker than expected. Another reading that focuses on business spending (instead of military and government) showed a 0.9% decline. The details within the report allow us to consider it good news for bonds and mortgage pricing.