US business spending surge more than expected in August; outlook uncertain

by   |  VIEW 728

US business spending surge more than expected in August; outlook uncertain

On Friday, the US Commerce Department data for US capital goods’ orders, a critical indicator to US business spending, had revealed that the investments in US businesses had been digging out of the pandemic blues, as the new orders for key US-borne capital goods had wildly beaten an analysts’ estimate last month, suggesting a likely rebound in business spending on equipment following a prolonged period of fiscal slump.

Aside from that, Friday’s Commerce Department data had also added that the shipments of US goods had also space-dived to their highest level in more than six month, pointing towards a turnaround in business activities, though a steady spike in the pandemic cases across the United States ahead of a November 3 Presidential election appeared to be darkening the outlooks.

US non-defence capital goods’ orders soar to highest level since July 2018

Besides, in what could be contemplated as one of the few brighter spots in the US economy amid a flurry of dismal fiscal data, Friday’s Commerce Department report had been quoted saying that the orders for non-defence capital goods excluding aircrafts, a critical indicator to future spending plans of the US businesses, had surged by 1.8 per cent in August, marking up the its highest level since the July of 2018, while the revised so-called core capital goods orders in July had spiked 2.5 per cent from a previously reported 1.9 per cent.

On top of that, according to the US Commerce Department data that released earlier on Friday, the US core capital goods orders had reached a pre-pandemic level last month, making a raft of analysts believe that the US business spending regained the momentum which had been lost during the pandemic outbreak.

US core capital goods orders were almost entirely buoyed by an increase in demands of machineries, industrial metals alongside computer and electronics product in August, while the orders for fabricated metals, electrical equipment, components and appliances had witnessed another set of holocausts.