By forex calendar in Core Durable Goods Orders m/m —

USD Core Durable Goods Orders m/m, Sep 25, 2025

Core Durable Goods Orders Plummet: Is the US Economy Heading for a Slowdown? (Updated Sep 25, 2025)

Breaking News (Sep 25, 2025): The latest Core Durable Goods Orders m/m report for the United States has been released, and the results are concerning. The actual figure came in at 0.4%, significantly lower than the forecast of -0.1%. This is also a dramatic decrease from the previous reading of 1.1%. The US Dollar is likely to experience some volatility following this release, given its medium-level impact.

What does this data mean for the US economy and what should traders be watching for in the coming weeks? Let's delve deeper into the specifics of Core Durable Goods Orders and analyze the implications of this latest report.

Understanding Core Durable Goods Orders

The Core Durable Goods Orders m/m, sometimes referred to as Durable Goods Orders Ex Transportation, measures the percentage change in the total value of new purchase orders placed with manufacturers for durable goods. The key here is "durable goods," which are defined as products designed to last for three years or more. Think of things like machinery, appliances, furniture, and electronics.

This report is published monthly by the Census Bureau, typically around 26 days after the month ends. This means the September 25, 2025 release reflects data from August 2025. It's important to remember that this data is often revised when the Factory Orders report is released approximately a week later.

Why Core Data Matters: Filtering Out the Noise

The headline "Durable Goods Orders" figure can be quite volatile due to large fluctuations in orders for aircraft. Aircraft orders are often large and infrequent, potentially skewing the overall trend. The "Core" figure specifically excludes transportation items (primarily aircraft) to provide a more stable and accurate representation of underlying purchase order trends. This makes the Core Durable Goods Orders a more reliable gauge of manufacturing activity and economic health.

Why Traders Pay Attention: A Leading Indicator of Production

Traders closely monitor Core Durable Goods Orders because it's considered a leading indicator of future production. An increase in new purchase orders suggests that manufacturers will need to ramp up production to fulfill those orders. This, in turn, can lead to increased hiring, investment, and overall economic growth. Conversely, a decrease in orders signals a potential slowdown in manufacturing activity and the broader economy.

The usual effect, as noted in the report details, is that an "Actual" reading greater than the "Forecast" is generally considered positive for the currency (USD in this case). This is because it suggests stronger economic activity, leading to potentially higher interest rates and a stronger dollar.

Analyzing the September 25, 2025 Data: A Cause for Concern?

The dramatic drop in Core Durable Goods Orders from 1.1% to 0.4%, falling short of the -0.1% forecast, is a worrying sign. While positive in isolation, the 0.4% figure indicates a significant slowdown in the pace of growth compared to the previous month. The fact that the actual number failed to meet expectations further amplifies the negative sentiment.

Here's a breakdown of potential interpretations:

  • Weakening Demand: The decline in orders suggests that demand for durable goods may be weakening. This could be due to various factors, such as rising interest rates making it more expensive for businesses and consumers to finance purchases, concerns about the economic outlook, or a shift in spending patterns.
  • Manufacturing Slowdown: A sustained decline in durable goods orders could lead to a slowdown in manufacturing activity. This could result in reduced production, job losses, and lower overall economic growth.
  • Impact on GDP: Durable goods orders are a component of Gross Domestic Product (GDP). A significant decline in orders could negatively impact GDP growth in the coming quarters.

Implications for the US Dollar and Market Outlook

Given the "medium" impact assigned to this data release, the US dollar is likely to experience some selling pressure in the short term. Traders may interpret this data as a signal that the Federal Reserve may be less inclined to raise interest rates aggressively, as a weakening economy could warrant a more dovish monetary policy stance.

What to Watch For Next

  • Factory Orders Report (Coming Soon): The upcoming Factory Orders report will provide a revised figure for Durable Goods Orders and will include more detail on the specific industries driving the changes. This release will be crucial in confirming the trend suggested by the Core Durable Goods Orders data. Look for significant revisions or discrepancies that could alter the market's perception.
  • Economic Commentary from the Fed: Pay close attention to any speeches or statements from Federal Reserve officials in the coming weeks. They may offer insights into how the Fed is interpreting the latest economic data and how it might influence future monetary policy decisions.
  • Consumer Confidence and Spending Data: Keep an eye on consumer confidence and spending data, as these indicators can provide further clues about the health of the economy and the demand for durable goods.

Conclusion:

The sharp decline in Core Durable Goods Orders reported on September 25, 2025, serves as a warning sign for the US economy. While not a definitive indicator of a recession, it warrants close monitoring. Traders and investors should carefully analyze the upcoming Factory Orders report and pay attention to any commentary from the Federal Reserve to gain a clearer understanding of the economic outlook and its potential impact on the US dollar and financial markets. The next release on October 27, 2025, will be closely watched for confirmation or a reversal of this concerning trend.