Bloomberg Surveillance 7/28/2025

US Core Capital Goods Orders have declined, a movement attributed to ongoing tariff uncertainty. This slide suggests businesses are curbing capital expenditure, potentially signaling a broader slowdown in investment and economic activity.

Analysis

The decline in US core capital goods orders, a key proxy for business investment, signals a tangible impact of ongoing tariff uncertainty on corporate behavior. This slide suggests businesses are deferring or canceling capital expenditures, pointing to deteriorating business confidence and a potential headwind for future economic growth. While the information also references a US-EU trade deal concerning the auto sector, the broader negative trend in capital goods orders indicates that specific sectoral negotiations are not enough to offset the wider economic drag from an unpredictable trade policy environment. This pullback in investment is a leading indicator that could foreshadow a broader slowdown in economic activity if the underlying trade tensions persist.