Gardner Intelligence Blog

September Cutting Tool Orders Highest Since March

September Cutting Tool Orders Highest Since March

In September 2020, real cutting tool orders were $156.4 million, which was the highest order total since March. Compared with one year ago, cutting tool orders contracted -21.2%. While this was the 19th consecutive month of month-over-month contraction, it was the slowest rate of month-over-month contraction since March. 

The annual rate of change contracted at an accelerating rate for the 12th month. The annual rate of contraction was 19.0%, which was the fastest rate of annual contraction since the data was made public. While the annual rate of contraction continued to accelerate, the one-month and three-month rates of change contracted at a slower rate, indicating that a bottom in the annual rate of contraction is near.

Money Supply Growth Continues to Accelerate

Money Supply Growth Continues to Accelerate

In October, the monetary base was $4.917 trillion, which was an increase from the previous month but still below the peak in June. Compared with one year ago, October’s monetary base was up 51.2%, which was the second month in a row and fourth in the last six months with faster than 50% growth. This was the seventh consecutive month that the month-over-month rate of change was faster than 44%. This was the 11th month in a row of month-over-month growth. The annual rate of growth accelerated to 30.4% in October, which was the seventh straight month of accelerating growth and the fastest rate of growth since August 2014.

Historically, the annual rate of change in the monetary base leads capital equipment consumption, specifically machine tool orders, by 12-18 months. Although, the lead time between the monetary base and capital equipment consumption shrunk over the last decade. 

Durable Goods Capacity Utilization Highest Since February

Durable Goods Capacity Utilization Highest Since February

In October, durable goods capacity utilization was 70.8%, which was the third month in a row that the rate of capacity utilization was above 70% and the highest rate of capacity utilization since February. Compared with one year ago, capacity utilization contracted 4.4%, which was the sixth straight month that the month-over-month rate of change contracted at a slower rate and the slowest rate of contraction since February. 

The annual change in durable goods capacity utilization contracted at an accelerating rate for the 12th month in a row, falling to -9.3% from -9.2%. October was the fastest rate of annual contraction since March 2010. As the annual rate of change tends to lead capital equipment consumption by seven-to-10 months, capacity utilization is signaling a bottom in the annual rate of change in capital equipment about the second quarter of 2021.

Moldmaking Technologies Interviews Gardner Intelligence About the October 2020 Moldmaking Index Results.

Gardner Intelligence sat down with Christina Fuges of Moldmaking Technologies to discuss the rebound in manufacturing economic activity already being experienced by moldmakers, molders and the supporting community.   To learn more click the image below or visit www.moldmakingtechnology.com/

Durable Goods Production Highest Since Start of Pandemic

Durable Goods Production Highest Since Start of Pandemic

In October, the index for production of durable goods was 103.6. Compared with one year ago, the index contracted 4.2%, which was the sixth consecutive month of decelerating contraction. This was the slowest rate of contraction since March. 

The annual rate of change, which is easier to correlate with other data points, contracted 8.6% this month. This was the eighth consecutive month of accelerating contraction. The key leading indicator of production—durable goods new orders—appears to have bottomed out, according to its rate of change, and indicating that production should do the same soon. Also, consumer durable goods spending, which leads durable goods new orders, reached an all-time high for four months in a row, growing at an accelerating each of those four months.

Reports

Top Shops

‘Top Shops’ is a benchmarking and recognition program designed to help shops build their business.

World Machine Tool Survey

An independent annual survey that collects statistics from machine tool consuming and producing countries and compares them in real U.S. dollars.

Capital Spending Survey

An annual survey that collects statistics regarding budgeted spending on machine tools, testing equipment, software and more.

Gardner Business Index

A diffusion index measuring month-to-month changes in activity at durable goods and discrete parts manufacturing facilities.