MONTH-OVER-MONTH RATE OF CONTRACTION IN DURABLE GOODS CAPACITY UTILIZATION SLOWED FOR THE FOURTH MONTH, A POSITIVE SIGN FOR MANUFACTURERS

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St. Paul, MN (March 22, 2020) – In February, durable goods capacity utilization was 74.7%, which was the second lowest rate of capacity utilization since September 2017, according to Steven Kline, Jr., Chief Data Officer, Gardner Business Media. Compared with one year ago, capacity utilization contracted 2.0%. This was the ninth month in a row and the 10th of the last 11 months that capacity utilization contracted. However, the month-over-month rate of contraction has decelerated since the peak rate of contraction in October 2019.

The annual change in durable goods capacity utilization contracted at an accelerating rate for the fourth month in a row, falling to -1.4% from -1.2%. February was the fastest rate of annual contraction since March 2017. As the annual rate of change tends to lead capital equipment consumption by seven-to-10 months, capacity utilization is signaling accelerating contraction in capital equipment spending through at least the first half of 2020.

The GBI: Metalworking backlog index tends to lead the annual rate of change in capacity utilization by seven-to-10 months. The annual rate of contraction in the Backlog index decelerated for the second month in a row. The Backlog index is indicating that the rate of contraction in durable goods capacity utilization should bottom out around June.

More from Mr. Kline and Gardner Business Media at: https://www.gardnerintelligence.com/

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Matsuura Machinery USA, Inc., located in St. Paul, MN is the U.S. subsidiary of Matsuura Machinery Corporation in Japan. Since 1935, Matsuura has been the forerunner in designing innovative technology and manufacturing solutions to a variety of industries around the globe. Matsuura Machinery USA, Inc. delivers unmatched excellence in 5-axis, vertical, horizontal, linear motor, multi-tasking CNC machine tools and machines with a powder bed metal AM platform with machining capability. Matsuura Machinery USA, Inc. provides the service, applications and technical field support that have always been the Matsuura standard for business.