Cutting Tool Orders Hit Highest Level since June 2015

Real cutting tool orders were $184.1 million in March 2016. This was the highest level for cutting tool orders since June 2015. However, the order total in March was 8.1 percent less than one year ago. This was the 11th conseuctive month of month-over-month contraction. The rate of contraction in February and March was notably lower than the rate of contraction from September to January though. The annual rate of change contracted at an accelerating rate for the sixth month in a row. 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, durable goods new orders, and the Gardner Business Index. Durable goods new orders have contracted significantly, which has likely led to the contraction in cutting tool orders. However, there are some positive signs in recent new order data, particularly in automotive and aerospace. Also, while it is still contracting, the Gardner Business Index has improved somewhat since November.