Orders for durable goods in the US barely inched up in June, rising just 0.3% when analysts were looking for around 2.5%. That’s like expecting a sprint but getting a slow shuffle instead. The total value of these orders came to $334.8 billion, a slight recovery after May’s steep 4.5% drop, but not enough to shake off the sluggish trend that’s been dragging on since spring.
Digging deeper, if you remove the volatile transportation sector, the core orders still underperformed, inching up only 0.6% when 0.8% was anticipated. The manufacturing engine isn’t firing on all cylinders. The only notable bright spot was in computers and electronic products, which surged 3.1%, adding nearly $900 million to the total. This uptick hints at strong demand in tech-related areas, possibly linked to the ongoing AI infrastructure expansion, even as broader industrial demand remains weak.
Why does this matter beyond just numbers? Because soft manufacturing data often signals the Federal Reserve might have more room to lower interest rates. Lower rates usually make riskier assets like cryptocurrencies more attractive since the returns on safer investments such as Treasury bonds become less enticing. When bond yields fall, investors tend to seek higher returns elsewhere, often turning to speculative markets including crypto. This report is one of several key economic signals that could influence the Fed’s decisions on whether to speed up rate cuts.
