Capital Goods (Sector)

Capital goods, in contrast with consumer goods, refers to goods that are utilized in the production of other goods but are not incorporated into other products themselves.

The capital goods sector is broad and wide-ranging, containing companies that manufacture equipment or machinery and those in the aerospace&defense industry.

The capital goods sector is highly cyclical, often fluctuating in tandem with the economy. However, due to globalization, the capital goods sector may be less reliant on the domestic economy as demand remains strong in emerging markets and an increasing share of some companies’ revenues are made internationally.