· For the U.S. factory sector, 2009 was rough but activity improved as the year went on. For the year as a whole industrial production fell 9.7% following a lesser 2008 decline. In June, however, the decline in activity troughed and since then is up 4.7% helped by an expected 0.6% December increase. Though the latest gain was all due to a rise in utility output with arrival of a winter cold snap, factory sector output alone is up 4.6% from its trough.

· Output of consumer goods rose 0.6% during December. Production here is up 4.8% from its trough due to a one-third rise in auto products output and a 4.4% gain in clothing. Computers, video & audio output lagged with a 2.2% rate of increase during the last six months while output of appliances, furniture & carpeting slipped 0.1%. The latter figure, however, shows some stabilization after an 18.0% full year decline. Business equipment output rose 0.9% last month (-9.6% y/y) and reversed the November decline. Moreover, since the June bottom activity has risen 3.2%.

· Capacity utilization rose further to 72.0%, its highest level since December 2008 but for the year as a whole the utilization rate dropped to 70.2%. In the factory sector alone utilization held steady m/m at 68.8% but dropped to 67.0% for the year from 75.0% in 2008. Utilization in the primary metals area has risen sharply to 58.9% from a 2009 average of 51.0% with the rebound in output. There's also been rise in utilization in the motor vehicle sector to 52.2% from a low of 36.8% in June but it was 77.0% in 2005. In rise in utilization was accompanied by a 0.1% m/m decline in capacity which was part of a 1.0% December-to-December decline. 

· The industrial production data are available in Haver's USECON database.

· Is the Great Moderation Over? An Empirical Analysis from the Federal Reserve Bank of Kansas City is available  here.