After managing a modest bounce in June, expectations were for a drop in Durable Goods Orders in July and just as we have seen soft survey and hard ‘real’ data disappoint, so did preliminary data showing a worse than expected 1.7% drop MoM.

Against expectations of a 1.0% drop, durable goods orders in July were ugly with a 1.7% drop – the most since January.

Core durable goods orders (ex-transportation) also missed expectations, rising only 0.2% MoM vs economists’ best guess of a 0.5% gain.

Orders rose for machinery, computers and electronic products and motor vehicles and parts last month, according to the report. The data, representing the first results since the U.S. and China imposed tariffs on each other’s goods in early July, signal that business investment remains intact even as President Donald Trump widens a trade war to a growing range of products from China.

There was a modest silver lining in the report as Capital Goods Shipments ex-air (proxy for capex spending) jumped more than expected – rising 0.9% MoM…

The drop in overall durable-goods orders reflects bookings for aircraft and parts, typically a volatile category. Civilian airplane orders fell 35.4 percent in July, while the military side dropped 34.6 percent. Boeing Co. previously reported that the planemaker received 30 orders in July, down from 233 in June.

US macroeconomic data disappointments continue to pour cold water on the ‘greatest economy’ narrative…