Capital Expenditures Exponentially Impact the Plastics Industry

The Plastics Industry Association (PLASTICS) has released an official analysis of capital expenditures and its impact on the plastics industry, authored by PLASTICS chief economist, Dr. Perc Pineda.

Dr. Pineda writes, “Despite weaker household spending and a decline in corporate profits in the first quarter, nonresidential investment spending, which can serve as a reasonable proxy for capital expenditures [CapEx] on a macro scale, has shown resilience with 10 consecutive quarters of growth. In the first quarter, nonresidential investment spending expanded by 3.3%, faster than the earlier estimate of 2.9%. Additionally, investment spending on structures, albeit minimal, was revised upward, showing an uptick of 0.4% in contrast to an earlier estimated downtick of 0.1%. Investment spending in intellectual property products also saw a significant revision, increasing from 5.4% to 7.9%. Higher investment spending on technology, including in artificial intelligence [AI], most likely explains the robust growth. Given that CapEx is a leading economic indicator, its growth suggests a cautiously favorable outlook for sectors that include the end markets of the plastics industry.”

The complete analysis can be accessed here.