U.S. investment growth outpaces consumption as capital spending accelerates

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U.S. investment growth outpaces consumption

Highlights

Inflation-adjusted non-residential fixed investment in the U.S. is growing at an annual rate of 6.9% in the first half of 2026, up from 3.8% in 2025.
Publicly traded U.S. companies are set to nearly double capital expenditures from $1.4 trillion in 2024 to $2.4 trillion in 2026.
Capital goods imports, excluding automotive products, are up 39% year on year, reaching a record share of total goods imports as consumer goods imports drop to a record low share.

National accounts show shift toward future-oriented spending

As reported by the Financial Times, the article argues that recent U.S. national income and product accounts data show output being used increasingly for investment rather than consumption. In this framework, private and government consumption support current demand, while investment and exports are treated as uses of output that help build future productive capacity.

In the first half of 2026, inflation-adjusted private consumption is growing at an annualised 2.2%, compared with GDP growth of just under 2.4%. Federal government consumption is falling, with real federal consumption expenditures down 2.3% year on year and down 3.9% cumulatively since the fourth quarter of 2024, while total government consumption is essentially flat.

That mix suggests production is outpacing household consumption and that public-sector consumption is no longer providing meaningful growth support. The result, in the article’s reading, is a rebalancing of the economy toward categories that can expand future output rather than present-day spending alone.

Capital spending and trade patterns support reindustrialisation

Business investment is rising faster than overall production under this picture. Inflation-adjusted non-residential fixed investment is growing at an annual rate of 6.9% in the first half of 2026, up from 3.8% in 2025 and 2.3% in 2024, while overall investment is increasing at an annualised 5.9%.

Publicly traded U.S. companies are on track to nearly double capital expenditures between 2024, at $1.4 trillion, and 2026, at $2.4 trillion. The article also points to trade data as further evidence of reindustrialisation, with real goods exports up 8.2% year on year in the second quarter and real exports of goods and services up 5.8%, including a 12.6% rise in capital goods exports excluding automotive products.

Imports are also shifting toward investment-related categories. Capital goods imports, excluding automotive products, are up 39% from the same point in 2025, reaching a record high both in dollar terms and as a share of goods imports, while consumer goods imports have fallen to their lowest share of total goods imports on record.

The U.S. still imports more than it exports or earns from net foreign direct investment, implying continued borrowing or asset sales to finance that gap. But the article contends that borrowing tied to investment carries different long-term implications from borrowing used to fund private or government consumption.

In our earlier coverage of rising long-term U.S. borrowing costs and widening fiscal deficits, we noted that 10-year Treasury yields above 5% are feeding through to mortgages, federal interest expenses, and broader financial conditions. The piece explained how a near-$2 trillion deficit and political gridlock limit the chances of near-term deficit reduction, reinforcing a tighter, more expensive funding environment even as demand for capital—particularly for large-scale infrastructure investment—stays elevated.

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