Core durable goods orders in the United States unexpectedly fell by 0.7% in June, indicating a cooling in business capital spending intentions.

In June, unexpected decrease in commercial equipment orders placed by businesses to US factories indicates a cautious attitude towards capital expenditure due to trade and government policy uncertainty. Data released by the US Commerce Department on Friday showed a month-on-month decrease of 0.7% in June for non-defense capital goods orders excluding aircraft, compared to market expectations of a 0.1% growth, while the revised data for May showed a growth of 2%. The bookings for all durable goods (items with a lifespan of at least three years, including commercial aircraft and military equipment orders) decreased by 9.3%, compared to market expectations of a 10.7% decrease. Earlier this month, Boeing reported a decrease in orders for June. Exports of non-defense capital goods, including aircraft (these exports are directly included in the GDP report's equipment investment section), decreased by 0.9%. Unlike cancellable orders, the government uses export data as a reference factor when calculating GDP. These data reflect the situation in the second quarter, during which expenditure on equipment purchases may have slowed significantly from the beginning of the year when a surge in aviation-related investments drove substantial growth. This investment growth at the beginning of the year was the largest since 2020. The US government will release the preliminary estimate data for the second quarter GDP next week. More broadly, planners faced challenges in the first half of this year due to frequent adjustments in tariff policies by Trump and uncertainties surrounding legislation on taxes and spending. Although Trump's "big and beautiful law" was passed earlier this month, eliminating some uncertainty to some extent, the unpredictable trade policies still keep some companies' investment plans uncertain. Economists at Bloomberg Eliza Winger stated in a report: "Uncertainty related to trade and tariffs, especially for companies with global supply chains, continues to pose risks for long-term investment planning." Small businesses also reported a decrease in capital expenditure and investment plans this month, as increased import tariffs eroded profits and led to rising raw material prices. The durable goods report showed a decrease in orders for computers and communication equipment. The report noted that core capital goods shipments (this indicator has smaller fluctuations and excludes aircraft and military equipment) increased by 0.5% from the previous value (0.4% after adjustments). Economists tend to focus on core shipment data as it provides a clearer reflection of actual sales figures. There is often a long time gap between ordering commercial aircraft and military equipment to actual shipment. Prior to the durable goods report, the GDPNow forecast by the Atlanta Fed showed that business equipment spending in the second quarter is expected to decline by 0.5 percentage points compared to the first quarter annualized rate. In the first three months of the year, business equipment spending had an annualized growth rate of 23.7%. The US Commerce Department's report showed a decrease of nearly 52% in commercial aircraft bookings in June after experiencing a significant increase in May. Boeing reported receiving a total of 116 orders in June, compared to 303 in May. Recent manufacturing survey results in the United States have been mixed. The preliminary manufacturing index for July published by S&P Global Companies showed the largest decline in three years, marking the first contraction since December last year. An index for manufacturing in the Philadelphia region significantly exceeded expectations, reaching its highest level since February.