Durable Goods +1.1% but Ex-Transportation Only +0.4% — and Core Capex Orders Just +0.2%

Fundamentals · 2026-08-26

New orders +$3.6 billion or 1.1 percent to $339.3 billion in July, up four of the last five months, after a revised +0.5 percent June; excluding transportation +0.4 percent; excluding defense +1.3 percent; transportation equipment +$2.6 billion or 2.3 percent to $116.2 billion, supplying 72 percent of the entire increase; nondefense capital goods orders +2.0 percent to $99.1 billion, but excluding aircraft just +0.2 percent to $85.9 billion after +1.7 percent in June; shipments +1.0 percent to $334.7 billion, up ten of the last eleven months; unfilled orders +0.6 percent to $1,599.9 billion, up twenty-four of the last twenty-five months; inventories +0.4 percent to $604.4 billion, up ten consecutive months; next release September 25.

What Is This?

• What it is: The Census Bureau's advance report on durable goods manufacturers' shipments, inventories and orders — the M3 survey, covering goods designed to last three years or more. New orders are the forward-looking measure: they are booked when a customer commits, not when the product ships, which makes them a leading indicator of factory activity. Release CB 26-134, covering July 2026.
• Why it matters: Buried in it is the cleanest monthly read on business capital investment — nondefense capital goods orders excluding aircraft. That series is one of the ten components of the Leading Economic Index, and it is the test of whether the record capital-spending intentions in this month's Philadelphia Fed survey are turning into actual orders.
• How to read it: Peel it in layers, because each layer is weaker than the one above. The headline includes transportation, which is dominated by lumpy aircraft orders that can swing the total by several percentage points in a month. Excluding transportation is better. Excluding aircraft from capital goods is better still. Note also what Census says about its own precision: "statistical significance is not measurable for this survey. The Manufacturers' Shipments, Inventories, and Orders estimates are not based on a probability sample, so the sampling error of these estimates cannot be measured nor can the confidence intervals be computed." Unlike the new home sales report published yesterday, there are no error bars here at all.

Want the full explainer? Economic News Events, Explained breaks down this release and every other one we cover, in plain English.

Summary

New orders for manufactured durable goods rose $3.6 billion, or 1.1 percent, to $339.3 billion in July — up in four of the last five months, following a revised 0.5 percent increase in June. That is the number the wires will carry, and it looks like a solid month for American manufacturing.

Peel back one layer and it thins out. Excluding transportation, new orders rose just 0.4 percent. Transportation equipment alone rose $2.6 billion, or 2.3 percent, to $116.2 billion — 72 percent of the entire $3.6 billion increase came from one volatile category, and that category was rebounding after two consecutive monthly decreases. Excluding defense, orders rose 1.3 percent, which tells you defense orders fell; defense capital goods orders were down 1.5 percent to $23.0 billion.

Peel back the second layer and the picture changes character entirely. Nondefense capital goods orders — the business investment measure — rose $1.9 billion or 2.0 percent to $99.1 billion, which reads as a capex surge. But nondefense capital goods excluding aircraft rose only $175 million, or 0.2 percent, to $85.9 billion, after 1.7 percent in June. Roughly 91 percent of the apparent capex gain was the aircraft component. The series economists actually use as the core business-investment proxy was, for practical purposes, flat.

That matters more than usual this month because of what it is being measured against. The Philadelphia Fed's August survey, released last Thursday, showed planned capital expenditures at 48.2 — the highest reading in 53 years. The obvious question at the time was whether record intentions would show up in actual orders. This is the first monthly read on that question, and the answer so far is no. Intentions at a five-decade high; core capital goods orders up two tenths of one percent.

The rest of the report is genuinely solid, and it is worth separating from the orders story. Shipments rose $3.2 billion or 1.0 percent to $334.7 billion, up in ten of the last eleven months, with transportation leading again. Core capital goods shipments — the line that feeds directly into the equipment investment component of GDP — rose 1.4 percent to $84.5 billion. So businesses are taking delivery of equipment they ordered earlier even as new commitments flatten. Unfilled orders rose 0.6 percent to $1,599.9 billion, up in twenty-four of the last twenty-five months, which means the backlog cushion under future production keeps thickening.

Inventories are the one line to keep an eye on. They rose 0.4 percent to $604.4 billion, up ten consecutive months, led by primary metals — up 1.5 percent to $51.9 billion and now higher for seventeen consecutive months. Seventeen straight months of primary metals accumulation is a long enough run to be a deliberate stance rather than a demand miss, and it is the kind of pattern that shows up when firms are stockpiling ahead of expected input-cost increases. Set that beside the Philadelphia Fed special question where 80 percent of cost-exposed firms expected competitors to raise prices within a median four months, and it reads as anticipatory rather than accidental.

Set against the rest of the week, this fits the dominant theme cleanly. Business investment is where the strength is supposed to be — the Conference Board explicitly forecast growth "driven by business investments in AI" — and yesterday's GDP revision put private domestic demand at 4.2 percent. But this release also revised consumer goods spending down within GDP, led by information processing equipment, and July's personal income data showed consumer goods spending falling $49.9 billion. Now core capital goods orders come in at 0.2 percent. Manufacturing is shipping its backlog and building inventory. What it is not currently doing is booking a wave of new investment commitments.

The Internals

The peeling exercise, July 2026 new orders:

Measure · Change · Level · What it strips out

Total durable goods orders · +1.1 percent · 339.3 billion dollars · Nothing

Excluding transportation · +0.4 percent · not stated in the advance text · Aircraft, vehicles, ships, rail

Excluding defense · +1.3 percent · not stated in the advance text · Military orders

Nondefense capital goods · +2.0 percent · 99.1 billion dollars · Defense and consumer goods

Nondefense capital goods excluding aircraft · +0.2 percent · 85.9 billion dollars · The lumpy aircraft component

Each layer down is weaker than the one above it, which is the single most important fact in this release.

Where the headline gain came from:

Component · Contribution · Share of the 3.6 billion dollar increase

Transportation equipment · up 2.6 billion dollars, plus 2.3 percent · about 72 percent

Everything else · about 1.0 billion dollars · about 28 percent

Within nondefense capital goods, aircraft-related · about 1.77 billion dollars · about 91 percent of that category's gain

Within nondefense capital goods, excluding aircraft · 0.175 billion dollars · about 9 percent of that category's gain

The four headline series:

Series · July level · Monthly change · Streak

New orders · 339.3 billion dollars · plus 1.1 percent · Up four of the last five months

Shipments · 334.7 billion dollars · plus 1.0 percent · Up ten of the last eleven months

Unfilled orders · 1,599.9 billion dollars · plus 0.6 percent · Up twenty-four of the last twenty-five months

Inventories · 604.4 billion dollars · plus 0.4 percent · Up ten consecutive months

Capital goods detail:

Measure · July level · Monthly change

Nondefense capital goods, new orders · 99.1 billion dollars · plus 2.0 percent

Nondefense capital goods excluding aircraft, new orders · 85.9 billion dollars · plus 0.2 percent

Nondefense capital goods, shipments · 97.0 billion dollars · plus 1.6 percent

Nondefense capital goods excluding aircraft, shipments · 84.5 billion dollars · plus 1.4 percent

Nondefense capital goods, unfilled orders · 951.2 billion dollars · plus 0.2 percent

Defense capital goods, new orders · 23.0 billion dollars · minus 1.5 percent

Defense capital goods, shipments · 19.6 billion dollars · virtually unchanged

The monthly series, seasonally adjusted percent change in total new orders:

Month · Change · Month · Change

August 2025 · plus 3.0 percent · February 2026 · minus 1.2 percent

September 2025 · plus 0.6 percent · March 2026 · plus 1.3 percent

October 2025 · minus 2.1 percent · April 2026 · plus 8.5 percent

November 2025 · plus 5.4 percent · May 2026 · minus 4.0 percent

December 2025 · minus 0.9 percent · June 2026 · plus 0.5 percent

January 2026 · minus 0.4 percent · July 2026 · plus 1.1 percent

April's 8.5 percent followed by May's minus 4.0 percent is the clearest possible illustration of why the headline is not a trend measure. This series swings on individual aircraft contracts.

Revisions to June, all manufacturing industries:

Series · Originally reported · Revised to

New orders · 656.5 billion dollars · 657.7 billion dollars

Shipments · 652.1 billion dollars · 653.5 billion dollars

Unfilled orders · 1,590.6 billion dollars · 1,590.3 billion dollars

Total inventories · 962.9 billion dollars · 963.2 billion dollars

Capex Intentions Versus Capex Orders

This release is the first hard test of the capital-spending story that has run through the past week's data:

Signal · Reading · What it is

Philadelphia Fed future capital expenditures · 48.2, a 53-year high · Intentions, six months ahead

Conference Board GDP forecast rationale · Growth "driven by business investments in AI" · Forecast narrative

GDP Q2, private domestic demand · plus 4.2 percent · Realised spending plus investment, last quarter

GDP Q2 revision, consumer goods · Revised down, led by information processing equipment · Actual, last quarter

Core capital goods orders, July · plus 0.2 percent · Actual new commitments, this month

Core capital goods shipments, July · plus 1.4 percent · Actual deliveries, this month

The gap between the first row and the fifth is the thing to watch. Record intentions have not yet converted into new orders. Shipments rising 1.4 percent while orders rise 0.2 percent says firms are working through equipment they committed to months ago rather than committing to more.

One month does not settle it. Core capital goods orders rose 1.7 percent in June, so the two-month average is still around 1 percent, and the Philadelphia Fed's intentions horizon is six months, not one. But anyone citing a 53-year high in capex plans as evidence of an investment boom should be asked what the orders data says, and as of July it says two tenths of one percent.

Impact on USD

• Mixed, lean bullish — a positive headline with a record backlog keeps the manufacturing recovery narrative alive and gives the Fed no growth reason to ease.
• Shipments up 1.0 percent and unfilled orders up for twenty-four of twenty-five months point to production activity holding into the third quarter.
• Offsetting: core capital goods orders at 0.2 percent is a weak read on the business investment that is supposed to be carrying this expansion.
• Weight caveat: Census publishes no confidence intervals for this survey at all, and the series swings on individual aircraft contracts.
• The release matters most as corroboration of the Philadelphia Fed and LEI capex story, and on that test it underdelivered.

Impact on US Indices (ES / NQ / YM)

• Mixed, lean bullish — a 1,599.9 billion dollar backlog growing for two years is genuine revenue visibility for industrials and capital goods names.
• Transportation equipment up 2.3 percent after two down months supports aerospace and its supply chain specifically.
• Against that, core capital goods orders at 0.2 percent is a caution flag for anyone positioned on an equipment and AI-infrastructure capex acceleration.
• Primary metals inventories up seventeen consecutive months reads as cost-anticipation stockpiling, which is margin-protective now and margin-dilutive if input prices do not rise.
• Defense capital goods orders down 1.5 percent is the one clear negative for that sub-sector.

Impact on Gold

• Slight bearish — firm manufacturing activity and a growing backlog argue against the recession hedge.
• Shipments up in ten of the last eleven months is not the profile of an economy rolling over.
• Offsetting: seventeen straight months of primary metals inventory building is consistent with firms expecting higher input costs, which is the inflation channel.
• Second-order for the metal — this is a manufacturing release, and the September 11 inflation print dominates the level.

What To Watch

• Full M3 report — Wednesday, September 2, 10am ET. Revised and more detailed estimates plus nondurable goods, which fills in what the advance leaves out.
• August advance durable goods — Friday, September 25. Whether core capital goods orders recover from 0.2 percent is the single most important line.
• The capex intentions gap. Philadelphia Fed plans at a 53-year high against core orders at 0.2 percent; if that gap does not close within two or three months, the intentions were sentiment rather than commitment.
• Primary metals inventories. Seventeen consecutive monthly increases. If firms are stockpiling ahead of cost increases, the next Philadelphia Fed prices-paid reading should confirm it.
• The backlog. Unfilled orders at 1,599.9 billion dollars are the cushion under future production. A stall there would matter far more than a soft month in new orders.

TLDR

Advance Report on Durable Goods, Census Bureau (July 2026, released August 26):

• New orders: +1.1 percent to $339.3 billion, up four of the last five months, after a revised +0.5 percent June
• Excluding transportation: +0.4 percent — the core measure
• Excluding defense: +1.3 percent; defense capital goods orders fell 1.5 percent
• Transportation equipment: +2.3 percent to $116.2 billion, supplying about 72 percent of the total gain
• Nondefense capital goods orders: +2.0 percent to $99.1 billion
• Nondefense capital goods excluding aircraft: +0.2 percent to $85.9 billion, after +1.7 percent in June
• Roughly 91 percent of the apparent capex gain was the aircraft component
• Shipments: +1.0 percent to $334.7 billion, up ten of the last eleven months
• Core capital goods shipments: +1.4 percent to $84.5 billion — deliveries outpacing new commitments
• Unfilled orders: +0.6 percent to $1,599.9 billion, up twenty-four of the last twenty-five months
• Inventories: +0.4 percent to $604.4 billion, up ten consecutive months; primary metals up seventeen consecutive months
• Census publishes no confidence intervals — this is not a probability sample

Read the layers, because each is weaker than the last: headline +1.1 percent, ex-transportation +0.4 percent, and core capital goods orders excluding aircraft just +0.2 percent. Transportation supplied 72 percent of the headline gain and aircraft supplied 91 percent of the capex gain. That matters because the Philadelphia Fed reported capital-spending intentions at a 53-year high last week, and this is the first month those intentions could have shown up as orders — they did not. The backlog and shipments are genuinely strong; new commitments are not. Watch the full M3 report on September 2 and whether core orders recover on September 25.

_For informational purposes only. Not investment advice._