Cutting Tool Orders Drop 3.6% in March 2014
According to the Cutting Tool Market Report, a joint statistical program between AMT and USCTI, real cutting tool orders were $171.4 million in March 2014. This was 3.6% less than the order total for March 2013. This is the sixth month in a row that cutting tool orders have contracted compared to one year ago. However, the rate of contraction in March was the slowest since October 2013. While still contracting, the annual rate of change has decelerated the last two months.
For March, my cutting tool forecast was too high by 2.3%. For the year, my forecast is too high by 3.1%. Based on my forecast, the month-over-month rate of change should become positive and stay that way for the remainder of the year. Therefore, the growth in monthly cutting tool orders should translate into cutting tool orders increasing 1.3% in 2014 compared to 2013.
While there is not much history to work from, it is likely that real capital goods new orders and the backlog index from our monthly business index should be good leading indicators for cutting tool orders.
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