In October, durable goods capacity utilization was 70.8%, which was the third month in a row that the rate of capacity utilization was above 70% and the highest rate of capacity utilization since February. Compared with one year ago, capacity utilization contracted 4.4%, which was the sixth 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 12^th month in a row, falling to -9.3% from -9.2%. October 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 a bottom in the annual rate of change in capital equipment about the second 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 10.5% compared with one year ago. This was the second straight month of accelerating growth and the fastest rate of growth since August 2018. The annual rate of contraction in the Backlog index reached 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