US durable goods orders weaken, jobless claims high

The reports released on Thursday sent US Treasury bonds higher, while stock futures pared their gains and the dollar fell.

“Durables are negative and a bit of a disappointment. The report does fall into the picture of a slowing US economy and therefore heightens expectations for a rate cut. That of course puts pressure on the dollar,” said Brian Dolan, director of foreign exchange strategy at Forex.com in New Jersey.

Durable goods orders fell by 1.7 percent in September on the back of a sharp drop in transportation orders. Analysts polled by Reuters were expecting a 1.5 percent rise in total orders last month after a 5.3 percent decline in August, earlier estimated as a 4.9 percent decrease.

Even when volatile data for transportation and defense orders were stripped away, the total was weaker than expected.

Transportation equipment orders fell 6.3 percent on a 37.3 percent slide in defense aircraft and parts orders. Motor vehicle and parts orders were down 2.9 percent. After stripping out transportation, orders rose 0.3 percent, weaker than the 0.7 percent rise analysts were expecting.

Meanwhile, the Labor Department said the number of US workers filing new claims for jobless aid fell by a much less than expected 8,000 last week, which left claims at fairly high levels.

Initial claims for state unemployment insurance benefits totalled 331,000 in the week ended Oct. 20 following the prior week’s upwardly revised 339,000, which originally had been reported as 337,000. Economists surveyed by Reuters had forecast a much lower total of 320,000 claims for last week.

A Labor Department official said there were no special factors to explain last week’s numbers, but noted that there might be some volatility in the data due to layoffs and re-hiring in the automobile industry linked to recent industrial action.

The number of so-called continuing claims rose by a modest 7,000 to 2.53 million in the week ended Oct. 13, the latest period for which figures were available. The continuing claims total was lower than economists’ forecasts for 2.54 million claims.