Core Durable Goods Orders

DEFINITION of 'Core Durable Goods Orders'

New orders for U.S. core durable goods, which are the total durable goods orders excluding transportation equipment. The new orders numbers are closely followed by market participants as they provide indications on current economic conditions as well as future production commitments in the manufacturing sector.

The new orders data is collated by the U.S. Census Bureau in its monthly manufacturers' shipments, inventories and orders (M3) survey, which covers manufacturing establishments with $500 million or more in annual shipments.

BREAKING DOWN 'Core Durable Goods Orders'

Durable goods are goods that do not wear out quickly or have a lifespan of more than three years, and include a wide range of items including computer equipment and industrial machinery, and trains, planes and automobiles.

However, transportation equipment is specifically excluded from core durable goods orders because of the high value of aircraft and other transportation equipment. An influx of large orders in one month can skew the monthly numbers and make it difficult to ascertain the underlying trend.