What is the Core Capital Goods Orders?

The Census Bureau publishes this series as nondefense capital goods excluding aircraft, within the advance report on durable goods. It reports new orders and shipments of nondefense capital equipment such as machinery, computers and electronic products, and electrical equipment, from the M3 survey. Figures are seasonally adjusted and not adjusted for price changes.

The Census Bureau tables label this series nondefense capital goods excluding aircraft and do not use the name core capital goods. Aircraft and defense capital goods are shown as separate lines, so both are outside this series.

Production facts:

  • Publisher: U.S. Census Bureau
  • Frequency: Monthly
  • Typical release time: 8:30 a.m. ET for the advance report, on the dates in the Census M3 schedule
  • Primary metric: Nondefense capital goods ex aircraft
  • Market sensitivity: High
  • Data type: Hard data
  • Economic indicator type: Leading
  • Revision risk: Medium

Key components to watch

The headline (Nondefense capital goods ex aircraft) is the most widely quoted but rarely the most informative number. The components that follow reveal whether the headline result is broad-based or concentrated, improving or deteriorating, and consistent with prior trends.

  • Capital goods
  • Nondefense capital goods
  • Nondefense excluding aircraft
  • Defense capital goods
  • New orders
  • Shipments

For any release with multiple components, the investor's task is not to memorize every number but to identify which components are most relevant to the current investment thesis and track those with the most care.

How to read the headline: actual versus expected

Markets react to the gap between the published Nondefense capital goods ex aircraft and the consensus forecast, not to the level alone. A stronger-than-expected or weaker-than-expected result is defined against that forecast, so check what was expected before reading the number.

The Core Capital Goods Orders carries medium revision risk: The advance report's table footnotes say estimates are based on the advance sample and are subject to survey error and revision. Read any revision to the prior period together with the new figure.

Market impact by asset class

The Core Capital Goods Orders primarily affects the following markets: Stocks, Industrials, Materials, Treasuries, USD, Commodities.

Stronger than expected result: In an inflation-elevated, tightening environment, a stronger result typically pressures interest-rate-sensitive assets and can strengthen the dollar. In a growth-slowing environment, a stronger result can be equity-supportive if it reduces recession fears.

Weaker than expected result: In a growth-concern environment, a weaker result may reinforce concerns about economic deceleration. If the Fed is watching this specific indicator for policy calibration, a persistent pattern of below-consensus results may shift the rate path.

In-line result: In-line results typically produce muted market reactions unless there are significant component deviations from expectations. The market had already priced the consensus, so confirmation requires little repricing.

Revision risk and methodology notes

The Core Capital Goods Orders carries medium revision risk. The advance report's table footnotes say estimates are based on the advance sample and are subject to survey error and revision. Revised data are marked r and are attributed to late receipts and concurrent seasonal adjustment. The M3 methodology document says survey data are benchmarked to reduce sampling and nonsampling errors.

Primary source: U.S. Census Bureau: Core Capital Goods Orders.

Publisher documents read for this page:

Common investor mistakes

  • Reacting to the headline without checking the components. The headline can diverge significantly from the underlying trend revealed by the components. A headline beat driven by a volatile component may not indicate the same strength as a broad-based improvement.
  • Ignoring revisions to prior periods. An initial strong number revised down in the following release tells a different story than a number that stands firm.
  • Not knowing what is consensus-priced. Reacting to a number without knowing what was already expected conflates information with noise. The market reaction is driven by the deviation from expectations, not by the level of the number.
  • Applying the same interpretation across different regimes. The same headline result has different implications depending on the Fed's current stance, the growth trend, and what is already priced into the yield curve and equity multiples.

Related releases

The Core Capital Goods Orders should be read alongside:

  • ISM Manufacturing PMI
  • ISM Services PMI
  • S&P Global US Manufacturing PMI
  • S&P Global US Services PMI
  • S&P Global US Composite PMI

Frequently asked questions

What is the Core Capital Goods Orders?

The Census Bureau publishes this series as nondefense capital goods excluding aircraft, within the advance report on durable goods. It reports new orders and shipments of nondefense capital equipment such as machinery, computers and electronic products, and electrical equipment, from the M3 survey. Figures are seasonally adjusted and not adjusted for price changes. It is published monthly by U.S. Census Bureau.

When is the Core Capital Goods Orders released?

The Core Capital Goods Orders is released by U.S. Census Bureau on a monthly schedule: 8:30 a.m. ET for the advance report, on the dates in the Census M3 schedule. Exact dates are on the publisher's release calendar.

How does the Core Capital Goods Orders affect markets?

The Core Capital Goods Orders primarily affects Stocks, Industrials, Materials, Treasuries. Its typical market sensitivity is rated High. A result that comes in stronger than consensus expectations generally moves affected markets directionally, while a weaker result can have the opposite effect. The direction depends on the current macro regime and what is already priced into markets.

What is the revision risk for the Core Capital Goods Orders?

The Core Capital Goods Orders carries medium revision risk. The advance report's table footnotes say estimates are based on the advance sample and are subject to survey error and revision. Revised data are marked r and are attributed to late receipts and concurrent seasonal adjustment. The M3 methodology document says survey data are benchmarked to reduce sampling and nonsampling errors.