Cutting Tool Orders Jump 20% in December
According to the Cutting Tool Market Report, a joint statistical program between AMT and USCTI, real cutting tool orders were $168.2 million in December 2014. This was 20.6% more than the order total for December 2013. In the two years that the data has been released to the public, this was by far the largest monthly increase. Also, this was the third time in four months that the month-over-month rate of change increased. The annual rate of change was still contracting, but the rate of contraction has decelerated each of the last five months. In December the annual rate of change was -0.7%.
For December my forecast was too low by 16.8%, which made my year-to-date forecast too high by 2.4%. My forecast is calling for cutting tool orders to increase 5.3% in 2015.
While there is not much history to work from with this report, there are a number of potential leading indicators for this data series, including durable goods production, capital goods new orders, and the Gardner Business Index. Based on the limited time frame, the metalworking portion of the Gardner Business Index has potential to be a good leading indicator for cutting tool orders.
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