US core capital goods orders rose 1.6% in August, exceeding expectations and boosting third-quarter GDP confidence.

According to Zhicheng Finance APP, US business equipment orders in August increased more than expected, continuing this year’s strong momentum in capital investment. Data released by the US Department of Commerce on Friday showed that core capital goods orders (excluding aircraft and military hardware), a proxy indicator for equipment investment, rose 1.6% month-on-month, with July's figure revised up to a 0.6% increase. Total durable goods orders (referring to goods with a lifespan of at least three years, including commercial aircraft and military equipment) remained largely unchanged. Boeing reported that its orders in August decreased compared to the previous month.

The durable goods report showed increases in orders for primary metals, machinery, computers, and electrical equipment. Orders for transportation equipment declined due to a decrease in both automobile and commercial aircraft orders.

So far this year, capital investment and demand have remained strong, led by expenditures related to artificial intelligence. In the first half of the year, US business equipment spending contributed solidly to US GDP.

Before the release of the durable goods report, the Atlanta Fed GDPNow forecast model estimated that business equipment spending would contribute nearly 1 percentage point to third-quarter growth. Combined with robust consumer spending, these figures lay the groundwork for another quarter of strong economic growth.