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June 2020 A Strong Month for Machine Tool Orders
The month-over-month rate of contraction in machine tool unit and dollar orders slowed sharply in June. The annual rate of contraction may be near or at a bottom.
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June machine tool orders were 2,149 units and $342,179,000.
June’s unit orders were the highest of 2020 and the third-highest since June 2019. Also, June was the first month with more than 2,000 units (more than 2,000 units is a strong month) since December 2019. June’s orders contracted 2.8% compared with one year ago, which was the third slowest rate of contraction in the last 13 months. The annual rate of contraction was 19.3%. The rate has contracted for 11 months, accelerating for six consecutive months.
Dollar orders contracted 7.4% compared with one year ago. This was the 17th straight month of dollar order contraction. However, it was the second slowest rate of contraction in those 17 months. The annual rate of change contracted for the 12th month in a row, but June was the first month that the rate of contraction decelerated.
The West region had a particularly strong month with unit orders up 6.9% and dollar orders up 18.2% compared with one year ago. Also, the Southeast had a very strong month with unit orders up 6.2% and dollar orders up 14.0% compared with one year ago.
The Gardner Business Index contracted at a decelerating annual rate in July. Also, the index has moved up toward 50 for three months in a row, indicating a slower contraction in recent months. The annual rate of contraction in the GBI tends to bottom out 7-10 months prior to machine tool orders.
