Orders for core capital goods in the U.S. rose by 0.7% in November 2025, marking the fifth consecutive monthly increase. According to the latest data from the U.S. Commerce Department, this continued growth suggests that businesses are maintaining steady spending on equipment, despite broader economic challenges. The rise in core capital goods orders, which excludes defense and aircraft, signals confidence in future demand and a steady outlook for manufacturing activity moving into early 2026.
The latest figures exceeded expectations, reinforcing the view that companies are preparing for sustained activity in the months ahead. Core capital goods orders are seen as a key indicator of business sentiment, as they reflect spending on machinery, equipment, and technology crucial for production capacity.
Key Categories Lead the Growth
The Commerce Department’s report highlighted gains across several important categories, including machinery, computers, and electronic products. These sectors are integral to production capacity, and the increase in orders suggests that businesses are prioritizing operational readiness in preparation for future demand. The growth in core capital goods orders indicates a continued commitment to modernizing production capabilities despite the challenges of rising borrowing costs.
Shipments of core capital goods also saw an increase, underscoring that these orders are not just theoretical but are translating into actual economic activity. The data aligns with broader expectations that spending on equipment will continue to contribute positively to the U.S. economy in the short term.
Business Spending Remains Resilient
The steady growth in core capital goods orders contrasts with concerns about higher borrowing costs, which typically weigh on business spending. However, companies appear to be prioritizing long-term operational capacity despite the elevated costs of financing. This resilience in business spending is encouraging as it reflects confidence in sustained economic momentum and a steady outlook for 2026.
Economists have pointed to the rise in orders as a sign of confidence in the broader economy, particularly in the manufacturing sector, which has faced challenges such as global supply chain disruptions and uncertain international markets. Yet, despite these challenges, the data suggests that domestic demand is providing enough stability for businesses to continue making investments in essential equipment.
Financing Trends Show Continued Demand
Beyond the orders themselves, data from the Equipment Leasing and Finance Association shows that businesses are borrowing more to finance their equipment purchases. In December 2025, borrowing for equipment leasing rose by 5.9% compared to the previous year, marking one of the highest levels ever recorded by the association. This increase in borrowing mirrors the rise in core capital goods orders, further illustrating that businesses are willing to take on debt to secure machinery and technology essential for growth.
This trend highlights the role of credit in supporting business activity, especially for companies that may be facing challenges in other areas, such as global supply chain issues or rising costs. Despite elevated interest rates, the willingness of firms to borrow reflects their belief in the long-term benefits of expanding production capacity and acquiring new technology.
Resilient Consumer Spending and Strong Labor Market
The rise in core capital goods orders coincides with strong consumer spending data for October and November 2025. These figures suggest that both households and businesses are contributing to economic growth, providing a solid foundation for continued recovery. The U.S. labor market also remains strong, with steady job growth and low unemployment rates, which further supports business spending and investment.
Manufacturing has been facing challenges, particularly from global disruptions and slowdowns in growth abroad, but domestic demand has largely offset these pressures. The continued rise in core capital goods orders reflects optimism in the U.S. market, signaling that manufacturers are preparing for continued activity.
Sustainability of the Trend: Risks and Challenges Ahead
While the growth in core capital goods orders is encouraging, economists caution that the sustainability of this trend remains uncertain. Rising borrowing costs and global uncertainties could dampen demand in the months ahead. However, for now, businesses appear to be maintaining a steady pace of spending, positioning themselves for stability despite external challenges.
As the year progresses, economists and analysts will continue to monitor trends in business spending and equipment orders. The data from November 2025 indicates that the manufacturing sector remains resilient, but it will be important to see whether these trends continue into 2026 or if external factors like supply chain disruptions or global slowdowns begin to impact future orders.
What’s Next for Core Capital Goods Orders?
With the data from November showing consistent growth in core capital goods orders, the next steps will depend on how businesses adapt to rising costs, global market conditions, and evolving consumer demand. The current momentum provides a positive outlook for the early part of 2026, but businesses will need to remain flexible in the face of potential economic uncertainties.
The sustainability of this growth will be closely monitored as we approach the end of the year. As core capital goods orders continue to rise, the broader economic implications of this trend will become clearer. For now, however, the steady increase in orders suggests that the U.S. manufacturing sector remains poised for continued stability, even amid broader challenges.
