Cutting Tool Orders Jump 12 Percent in December

Real cutting tool orders were $176.0 million in December 2016, which was the highest level since March 2016 and the second highetst since October 2015. December's orders were up 12.0 percent compared with one year ago, which was the fastest rate of growth since December 2014. This was the third time in five months that orders increased. Each of those three months the rate of growth accelerated. The annual rate of contraction hit its bottom back in July. Since, the rate of contraction has decelerated. December's rate of annual contraction was the slowest since November 2015. 

The trend in durable goods new orders, which is a good leading indicator of cutting tool orders, appears to be moving in a positive direction for future cutting tool orders. Durable goods new orders generally have contracted at a decelerating annual rate since October 2015.

Also, the GBI: Metalworking showed the metalworking industry is rapidly improving. The rate of change of the index grew for the second month in arow. The trend in the index is very positive for cutting tool orders in 2017.