US headline durable goods orders dropped -1.7% in July versus expectation of 1.0% rise. Ex-transport goods rose 0.2% versus expectation of 0.3%. However, it should be noted that non-military capital-goods orders excluding aircraft jumped 1.4%, showing solid increase in business investments. Shipments rose 0.9% which should provide solid contribution to Q3 GDP.
The overall set of data argues that the impact from escalation of US-China trade war didn’t have material impact of business investments yet, despite the cries for lower confidence. However, August and September figures will provide a more realistic picture as larger batch of tariffs came into effect.
