The good news?  We may not head into another recession.  The bad news?  The US economy isn’t growing, either.  A pair of economic indicators has economists warning about a new round of “deceleration,” even though we hardly saw any real acceleration prior to now.

First, the report from Commerce on durable-goods orders offers a wan outlook on manufacturing:

New orders for manufactured goods in October, down two consecutive months, decreased $1.6 billion or 0.4 percent to $450.0 billion, the U.S. Census Bureau reported today.  This followed a 0.1 percent September decrease.  Excluding transportation, new orders increased 0.2 percent.  Shipments, up five consecutive months, increased $2.6 billion or 0.6 percent to $455.4 billion.  This followed a 0.3 percent September increase.  Unfilled orders, up eighteen of the last nineteen months, increased $1.8 billion or 0.2 percent to $885.9 billion.  This followed a 0.6 percent September increase.  The unfilled orders-to-shipments ratio was 6.07, down from 6.08 in September.  Inventories, up twenty four of the last twenty five months, increased $5.6 billion or 0.9 percent to $607.1 billion.  This was at the highest level since the series was first published on a NAICS basis in 1992 and followed a 0.1 percent September increase.  The inventories-to-shipments ratio was 1.33, unchanged from September.

Inventory increases can either mean that manufacturers are preparing for a new spending binge, or that stock is not moving as predicted.  The latter will force retailers to heavily discount to clear their shelves, which will lower profits and slow demand for new orders.  That’s already happening in the transportation sector, which saw its inventory increase 0.9% in October, with a drop in orders of 5.1%.

Nor is the “deceleration” confined to the manufacturing sector.  Reuters reports on the October manufacturing report, and also on November’s results in the service sector:

The economy showed signs it was decelerating, with an index of service activity pointing to slower growth in November while new orders for factory goods declined in October for the second straight month.

The Institute for Supply Management said on Monday its services index fell to 52.0 last month from 52.9 the month before. The reading was below economists’ forecasts for 53.5, according to a Reuters survey. …

“This is the first disappointing indicator we’ve seen in the last couple of weeks,” said Cary Leahey, managing director at Decision Economics in New York.

“The economy has improved, it is still not growing very quickly.”

Anything above 50 in this index indicates growth, but the direction is important as an indicator as well.  Keep in mind that the recently revised Q3 GDP growth number was an already-mediocre 2.0%, which means that we’re “decelerating” from a stagnation position.  Put this on top of an employment report that shows 315,000 people dropping out of the work force, and it means that we are not going to see real economic growth any time soon — and we may well still be at risk for another recession, regardless of whether Europe can get its act together or not.