Shipments of US core capital goods increased 1.2% in September, accelerating from a 0.6% rise in August, according to data from the US Census Bureau.
Orders for non-defence capital goods excluding aircraft rose 0.5% in September after increasing 1.6% in August. The latest reading fell short of economists’ expectations of 0.7%.
Core capital goods shipments contribute to the equipment investment component of US gross domestic product. Heavy investment in artificial intelligence infrastructure has supported business equipment spending, which recorded double-digit growth for two consecutive quarters.
Jefferies Maintains Bullish Treasury Outlook
Jefferies maintained a bullish view on five-year US Treasury bonds and expected yields to decline, according to global economist Mohit Kumar.
The firm expects the US Federal Reserve and European Central Bank to leave interest rates unchanged at their meetings this week. Kumar expects both institutions to deliver one rate hike each in December.
Jefferies’ base case assumes oil prices will begin declining by March 2027, reducing inflationary pressure and the need for further rate increases.
Economists also expected the preliminary third-quarter US GDP estimate, due Thursday, to show annualised growth exceeding 3%, according to the supplied report.
Q1. How much did US core capital goods shipments rise?
Shipments increased 1.2% in September.
Q2. How much did core capital goods orders increase?
Orders for non-defence capital goods excluding aircraft rose 0.5%.
Q3. What is Jefferies’ view on five-year US Treasuries?
Jefferies maintains a bullish outlook and expects yields to decline.
Q4. What does Jefferies expect from the Fed and ECB in December?
It expects one rate hike from each central bank in December.
