In September, durable goods capacity utilization was 69.4%, which was the third month in a row that the rate of capacity utilization was at least 69.4%. Compared with one year ago, capacity utilization contracted 7.5%, which was the fifth straight month that the month-over-month rate of change contracted at a slower rate and the slowest rate of contraction since February. 

The annual change in durable goods capacity utilization contracted at an accelerating rate for the 11^th month in a row, falling to -9.3% from -8.9%. September was the fastest rate of annual contraction since March 2010. As the annual rate of change tends to lead capital equipment consumption by seven-to-10 months, capacity utilization is signaling accelerating contraction in capital equipment spending through at least the fourth quarter of 2020 and possibly into the first quarter of 2021.

The GBI: Metalworking backlog index tends to lead the annual rate of change in capacity utilization by seven to 10 months. In September, the backlog index grew 3.6% compared with one year ago. This was the first month of month-over-month growth since October 2018. The annual rate of contraction in the backlog index appeared to reach a bottom in June. The Backlog index is indicating that the accelerating contraction in durable goods capacity utilization will likely end during the 4^th quarter of 2020.

Accelerating Growth: 

Decelerating Growth: 

Accelerating Contraction: aerospace, construction materials, durable goods, electronics/computers, forming/fabricating (non-auto), furniture, machinery/equipment, petrochemical processors, primary metals, printing, textiles/clothing/leather goods, wood/paper products

Decelerating Contraction: automotive, custom processors, food/beverage processing, plastics/rubber products