US core capital goods rise in September; shipments accelerate
SPY•US core capital goods orders rose 0.5% in September, below economists’ 0.7% forecast, while shipments climbed 1.2%. The figures suggested equipment spending maintained a robust growth pace in the third quarter.
1. Orders and shipments
Non-defense capital goods orders excluding aircraft rose 0.5% in September after a 1.6% increase in August, the Census Bureau said. Shipments of core capital goods, which feed into the equipment-spending component of gross domestic product, climbed 1.2%.
2. AI spending concerns
Business equipment spending has posted two consecutive quarters of double-digit growth, largely fueled by investment in AI. Economists expect the government’s advance estimate to show third-quarter economic growth above a 3.0% annualized rate, while investors are increasingly focused on the rising costs and uncertain payoffs of long-term AI infrastructure projects.
