In November, the monetary base was $5.093 trillion, which was an increase from the previous month and the second highest (May 2020) level ever. Compared with one year ago, November’s monetary base was up 53.6%, which was the third month in a row and fifth in the last seven months with faster than 50% growth. This was the eighth consecutive month that the month-over-month rate of change was faster than 44%. This was the 12^th month in a row of month-over-month growth. The annual rate of growth accelerated to 35.4% in November, which was the eighth straight month of accelerating growth and the fastest rate of growth since June 2010.

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. 

The recent rapidly accelerating growth in the monetary base should eventually lead to accelerating growth in machine tool orders and capital equipment in general. It is likely that machine tool orders bottomed in August.