U.S. Core Capital Goods Orders Rise Despite Government Shutdown

In September 2025, U.S. core capital goods orders—non-defense capital goods excluding aircraft—rose by 0.9%, matching the upwardly revised 0.9% increase in August. Shipments of these goods also increased by 0.9%, following a slight decline in the previous month. These figures, reported by the Commerce Department's Census Bureau on November 26, 2025, were delayed due to a 43-day government shutdown. The data suggests robust business investment and supports expectations of accelerated economic growth in the third quarter. (reuters.com)

The release of this data was postponed due to a 43-day federal government shutdown that began on October 1, 2025, and ended on November 12, 2025. This shutdown, the longest in U.S. history, resulted from a budget impasse primarily over the extension of Affordable Care Act subsidies. Approximately 900,000 federal employees were furloughed, and another two million worked without immediate pay. The shutdown had widespread effects, including the suspension of various government services and economic data releases. (en.wikipedia.org)

The increase in core capital goods orders and shipments indicates strong business investment, a key driver of economic growth. This trend suggests that businesses are confident in the economic outlook, leading to increased spending on equipment and infrastructure. Such investments are crucial for enhancing productivity and sustaining long-term economic expansion.

However, the government shutdown had significant economic repercussions. The Congressional Budget Office estimated that the shutdown could cost the economy between $7 billion and $14 billion, potentially reducing GDP growth by up to 2% in the fourth quarter. While some of this loss may be recovered, a substantial portion is expected to be permanent. (economictimes.indiatimes.com)

Treasury Secretary Scott Bessent expressed confidence that the U.S. economy will avoid a recession despite the recent 43-day government shutdown, which caused an $11 billion permanent economic loss. Speaking on NBC’s “Meet the Press,” Bessent acknowledged that interest rate-sensitive sectors like housing experienced recessions but emphasized that overall economic growth remains intact, buoyed by easing interest rates and upcoming tax cuts. (reuters.com)

In November 2025, consumer confidence significantly declined, with the Conference Board's index falling to 88.7 from 95.5 in October, marking its lowest level since April. This decline was attributed to the aftermath of the government shutdown, lingering inflation, and weak job growth. (apnews.com)

The September 2025 data on core capital goods orders and shipments provides a nuanced view of the U.S. economy's strength and the challenges it faces. While the increase in business investment is a positive sign, the broader economic context, including the recent government shutdown and its associated costs, underscores the complexity of the current economic landscape.