The US durable goods report for October was released today and new orders were down 8.3% from September driven by a big decrease in civilian aircraft, but buried in the numbers we find:
“This is how a slowdown starts,” said Ken Mayland of Clear View Economics. However, he cautioned that “by no means are we in any dire straights, as order books remain relatively strong.” He added that “some of the weakness may simply be a timing issue related to the release of new software.”
Indeed, orders for computers and related products dropped 25.6% for October, while shipments fell 24.9%. That, however, may simply highlight a dip in demand as consumers await the release of Microsoft’s Vista operating system in January.
The full set of numbers are here, but whether it’s caused by customers waiting for Vista or not, that 25% hits both Microsoft and the PC vendors where it hurts. One month in the USA does not make a global trend, but it’s worth watching.