Caterpillar cuts profit forecast due to weak exports

The global machinery giant Caterpillar is reporting a profit increase of nearly 50 percent last quarter compared with a year ago. Yet, the Peoria Illinois-based company is cutting its forecast for this year citing a weakening in the global economy.

The company, which is considered an economic bellweather, said exports to Europe and Latin America, in particular, had slowed.

Analyst Juli Niemann of Smith Moore & Company says the U.S. economy could be a bright spot for companies like Caterpillar as construction spending increases. “There is hope that the United States market is going to be strong enough to take up slack from the rest of the world,” Niemann adds.