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Economy in Brief

Industrial OutputĀ Rebounded in October
by Tom Moeller November 17, 2005

Industrial output last month rebounded 0.9% following the effects of Hurricane's Katrina & Rita which lowered September output by a revised 1.5%. The increase about matched Consensus expectations for a 1.0% gain.

Another sharp decline of 1.9% in utility output (+1.3% y/y) which followed two consecutive months of 0.9% drop held back the gain in total output. Mining output (-0.6%) also fell for the fourth consecutive month (-8.1% y/y). These declines were offset by a 1.5% spurt in factory sector production (3.3% y/y) which more than recovered the prior month's 0.7% shortfall.

A huge 6.5% (8.5% y/y) gain in output of business equipment led the strength in factory output last month. The strength was paced by a 36.8% rise in transit equipment which was recovering from a 25.5% plunge in September. Output of computers, peripheral equipment & semiconductors also were strong and rose 1.7% (24.8% y/y) led by a 2.8% jump in communications equipment (23.2% y/y). Excluding the high tech sector altogether, factory output gained 1.3% (1.8% y/y).

Output of appliances, furniture & carpeting fell 0.6% (+3.5% y/y) but output of nonenergy, nondurables rose 0.2% (1.6% y/y) led by a 0.6% (0.8% y/y) increase in chemical production. Clothing output fell 2.5% (-2.2% y/y).

Total capacity utilization rose to 79.5% and capacity grew 1.6% y/y. Factory sector utilization rose to 79.0% while capacity rose 2.0% y/y. Figures for both output and capacity were upwardly revised

Production & Capacity Oct Sept Y/Y 2004 2003 2002
Industrial Production 0.9% -1.5% 2.0% 4.1% 0.6% 0.1%
  Consumer Goods -0.4% 0.5% 2.0% 2.1% 1.0% 2.2%
  Business Equipment 6.5% -4.6% 8.5% 9.3% 0.0% -7.8%
Capacity Utilization 79.5% 78.9% 79.2% (10/04) 78.6% 75.7% 75.2%
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