Orders placed with U.S. factories for business equipment increased slightly in July after a downward revision to the prior month's numbers, suggesting companies are somewhat cautious about capital investment amid high borrowing costs and economic concerns.
The value of core capital goods orders, a proxy for investment in equipment that excludes aircraft and military hardware, increased 0.1 percent last month after a revised 0.4 percent decline in June, Commerce Department figures showed Thursday. The numbers aren't adjusted for inflation.
Bookings for all durable goods—items meant to last at least three years—slid by the most since April 2020, reflecting fewer bookings for commercial aircraft. Excluding transportation equipment, orders rose 0.5 percent.
| Metric (Month-over-Month change) | Actual | Estimate |
|---|---|---|
| Durable goods orders | -5.2% | -4% |
| Capital goods orders excluding defense & aircraft | +0.1% | +0.1% |
| Capital goods shipments, excluding defense & aircraft | -0.2% | +0.1% |
The figures underscore how high borrowing costs, stiffer credit terms, and lingering economic uncertainty are curbing firms' desire to pursue longer-term capital investments. The report showed a decline in bookings for computers and related products.
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