Foundation-Keybridge Equipment & Software Investment Momentum Monitor

The Foundation-Keybridge U.S. Equipment & Software Investment Momentum Monitor consists of indices for 12 equipment and software investment verticals. These indices are designed to identify turning points in their respective investment cycles with a 3 to 6 month lead time for the following verticals:

Vertical Markets

Business leaders require actionable forward-looking intelligence to make strategic decisions. The Foundation-Keybridge U.S. Equipment & Software Investment Momentum Monitor consists of indices for 12 equipment and software verticals . These indices identify key turning points in their respective investment cycles with a 3 to 6 months lead time. Equipment and software investment data comes from the Bureau of Economic Analysis (Nonresidential Private Fixed Investment, chained dollars) and is publicly available on BEA's website on a quarterly basis. The underlying Momentum Monitor data comes from other publicly available sources (published monthly), including BEA and the Census Bureau, and is used to calculate the Momentum Monitor indices.

Agricultural Machinery

IInvestment in Agricultural Machinery decreased 23% (annualized) in Q1 2021 but is up 13% from one year ago. The Agriculture Momentum Index fell from 107.2 (revised) in June to 102.6 in July. In May, Agricultural Machinery Industrial Production increased by 0.8%, while Lamb & Mutton Production fell by 19.1%. Overall, the current position and recent movement of the Index suggests that agriculture machinery investment growth is likely to decelerate over the next six months.

Construction Machinery

Investment in Construction Machinery expanded 31% (annualized) in Q1 2021 and is 3.6% above its year-ago level. The Construction Momentum Index grew from 104.1 (revised) in June to 106.6 in July. In May, Shipments of Construction Machinery rose by 1.3% and Housing Permits for Structures with 2 to 4 Units rose by 16%. Overall, the elevated position of the Index suggests construction machinery investment growth should continue to strengthen over the next two quarters.

Materials Handling Equipment

Investment in Materials Handling Equipment grew at a 1.8% annualized rate in Q1 2021 and is up 12% year-above year-ago levels. The Materials Handling Momentum Index edged down from 99.1 (revised) in June to 97.7 in July. In May, Export Prices of Materials Handling Equipment ticked up by 1.1% and Materials Handling Equipment Exports rose by 20%. Overall, the current position of the Index indicates that materials handling equipment investment growth will remain robust over the next six months.

Other Industrial Equipment

Investment in All Other Industrial Equipment expanded 9.6% (annualized) in Q1 2021 and ticked up by 0.9% Y/Y. The Other Industrial Equipment Momentum Index inched up from 117.5 in June (revised) to 118.3 in July, the highest level in a decade. Exports Prices of Industrial Supplies & Materials rose by 4.1% in April and Nonfarm Payrolls increased by 0.6% in June. Overall, the Index’s position suggests that other industrial equipment investment growth should continue to improve over the next six months.

Medical Equipment

Investment in Medical Equipment increased 12% (annualized) in Q1 2021 and is up 23% over-year. The Medical Equipment Momentum Index decreased from 102.0 (revised) in June to 98.7 in July. In May, Consumer Prices for Physician’s Services was unchanged while Industrial Production for Electrical Equipment ticked down by 0.6%. Overall, the position and recent movement of the Index suggests that medical equipment investment growth may have peaked but should remain strong over the next two quarters.

Mining & Oilfield Machinery

Investment in Mining & Oilfield Machinery climbed 20% (annualized) in Q1 2021 but is 21% below year-ago levels. The Mining & Oilfield Machinery Momentum Index ticked down from 103.1 (revised) in June to 102.3 in July. Mining, Oil, and Gas Field Machinery Inventories increased by 3.1% in May and the Brent Spot Price jumped 10.9% in June. Overall, the Index’s position suggests that mining & oilfield equipment investment growth should accelerate over the next six months, though Y/Y growth rates may stay in negative territory.

Aircraft

Investment in Aircraft declined 12% (annualized) in Q1 2021 and is 32% below year-ago levels. The Aircraft Momentum Index eased from 115.4 (revised) in June to 113.7 in July. Aerospace Exports to Canada jumped 18.7% in May and Capacity Utilization rose 0.8%. The current position of the Index suggests that aircraft investment growth will continue to improve over the next six months, though Y/Y growth rates may remain negative.

Ships & Boats

IInvestment in Ships & Boats fell at an annualized rate of 4.8% in Q1 2021 and is 2.0% above its year-ago level. The Ships & Boats Momentum Index fell from 116.2 (revised) in June to 114.3 in July. In May, Ships & Boats Shipments grew by 1.5%, while Inventories of Ships and Boats fell by 1.8%. Overall, the Index suggests that ships & boats investment growth should improve over the next six months.

Railroad Equipment

Investment in Railroad Equipment surged 55% (annualized) in Q1 2021 but is down 5.6% year-over-year. The Railroad Equipment Momentum Index decreased from 101.4 (revised) in June to 98.3 in July. Industrial Production of Mining increased 1.2% in May and Oil and Gas Rig Counts rose 4.7% in June. Overall, position of the Index and recent movement suggest investment in railroad equipment may improve over the next six months.

Trucks

Investment in Trucks grew 11% (annualized) in Q1 2021 and is up 6.8% from year-ago levels. The Trucks Momentum Index rose from 106.7 (revised) in June to 108.4 in July. In May, Earnings for Freight Trucking rose by 2.6% and Manufacturers' Inventories of Light Trucks & Utility Vehicles grew by 2.8%. Overall, the Index’s recent movement indicates that investment growth could strengthen over the next two quarters.

Computers

Investment in Computers surged 52% (annualized) in Q1 2021 and is up 44% year-over-year. The Computers Momentum grew from 123.4 (revised) in June to 126.6 in July. In May, Capacity Utilization for Computer & Electronic Product Manufacturing increased by 1.2% and Industrial Production of Computers & Computer Peripheral Equipment rose by 5.5%. Overall, the Index suggests that computers investment growth should remain strong in the near term.

Software

Investment in Software increased 25% (annualized) in Q1 2021 and is up 9.2% from a year prior. The Software Momentum Index rose from 104.9 (revised) in June to 108.3 in July. In May, NFIB Small Business Survey Capital Expenditure Sub-Index was unchanged at its highest level this year, while Prices for Computer Software & Accessories increased by 1.0%. Overall, the Index suggests that software investment growth should remain robust and may even accelerate over the next six months.