U.S. Core Capital Goods Orders Surge 1.1% in July as Businesses Unleash Spending Spree

Corporate America's checkbooks are wide open—capital goods orders just smashed expectations with a 1.1% July surge.

Manufacturing Momentum Builds

Businesses aren't just dipping toes in the water—they're diving headfirst into equipment upgrades and expansion plans. That 1.1% jump signals confidence isn't just returning—it's roaring back.

Spending Patterns Shift

While traditional investors chase yesterday's news, smart money's already pricing in what this means for productivity gains and tech adoption curves. Hardware doesn't lie—unlike earnings reports massaged by creative accountants.

The real question isn't whether this trend continues—it's whether legacy finance will even recognize the transformation happening right under their spreadsheets.

Companies increase shipments as investment gains speed

Shipments of non-defense capital goods, including aircraft jumped 3.3%. These are the numbers that feed directly into GDP calculations. Orders can be canceled, but shipments actually happened. That’s what gets counted in economic growth reports.

Meanwhile, Core capital goods shipments, which leave out aircraft and military equipment, rose 0.7%. That figure was revised higher for June too. Economists like this number more because it’s less messy and not distorted by huge one-off plane or tank orders that may not ship for years.

Some of this uptick in activity ties back to Q1 when Boeing’s orders surged. Another reason companies are suddenly spending again is AI. A bunch of firms ramped up equipment purchases to support artificial intelligence projects. Those investments are aimed at cutting costs and dealing with expensive tariffs and import duties.

The data showed orders for computers, machinery, electrical gear, metals, and even motor vehicles all went up in July. Businesses were cautious for most of the year, unsure about where demand was heading or what tariffs might get slapped on next. But July looked like the beginning of a turnaround, at least for now.

Even with this rise, most analysts think business investment will stay weak through the rest of the year. They expect momentum to pick up in 2026, thanks to new tax benefits from Trump’s One Big Beautiful Bill. That bill includes incentives for companies that invest in new equipment and technology.

On the flip side, while capital spending improved, U.S. consumer confidence slid again in August. The Conference Board said its consumer sentiment index dropped to 97.4, down from a previously revised 108.7 in July. People are more nervous about jobs and income.

The expectations index, which looks at where consumers think things are heading over the next six months, also dropped. So did the present conditions gauge, which hit its lowest reading since April.

The Bloomberg survey had expected a sentiment score of 96.5, so the drop was sharper than some economists had forecast. People aren’t convinced the job market will hold steady, and they’re still feeling the sting from inflation and higher costs, even as businesses are out there upgrading their gear and pouring money into AI infrastructure.

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