Machine Tool Contraction Accelerates

In February, machine tool orders were 1,550 units and $264,500,000. Unit orders were up significantly while dollar orders were down from the previous month. Therefore, the average price fell from its January level. However, the average price in February increased 5.5 percent compared with one year ago. Increasing prices is a positive sign for machine tool builders.

Compared with one yearo ago, unit orders were down 17.8 percent in February. The month-over-month rate of change contracted for the 10th month in a row, and February had the fastest rate of contraction since August 2015 (excluding September because it is affected by IMTS). The annual rate of change contracted for the fsixth month in a row. The annual rate of change, now -12.5 percent, contracted at an accelerating rate for the third month in a row. My unit order forecast for January was too low by about 10 percent for the second month in a row.

Real dollar sales were down 13.3 percent compared with February 2015. This was the 10th consecutive month that dollar orders have contracted. This was the slowest rate of contraction since July 2015. The annual rate of change was unchanged in February, which ended a string of eight months of accelerating contraction. 

You can find more on machine tool sales and the leading indicators on our metalworking and monetary pages.