Durable goods orders tumbled in January
Welcome back to Squawk Box. Rick Santelli here live at CMEHQ with the breaking news of the morning starting out with durable good orders. These are January preliminary expecting a number down 4 percent, down 4.5 percent. That is the weakest month over month change going all the way back to April of 2020. Strip out transportation and it zooms up into positive territory so we could see the culprit here up 7 tenths of 1 percent when you strip out transportation and up 7 tenths. Well that is the best number going back to March of last year.
Up 8 tenths on capital good orders, non-defense X aircraft, much better than the unchanged expected. That's a proxy of course for capital expenditures and finally if we switch gears from orders to shipments up 1.1 percent. That's a powerful number the best since October of last year and we see that interest rates are hovering right about where they were 394 before the data was released. A couple of things very quickly. Two year notes are the only maturity on the Treasury curve that's taken out its fall post-COVID high yield close. We haven't seen it in any other maturity.
Three years about 13 basis points away, five years 24 basis points away. Ten year at 394 there are about 30 basis points away from their 4.24 high yield close back in October and it hasn't closed at 4 percent or higher since November 9th. It's one of the main reasons that many are questioning exactly what's going on with the inverted curve and how much damage may be caused to the economy by the Federal Reserve's tightening policies of course as we see many maturities bucking the trend even though the markets have really come more in line taking recent data with respect to where the ultimate line in the sand may be for the terminal rate as you look at FedFun futures. Becky back to you.
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