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Economy in Brief

U.S. Industrial Production Gain MinimalĀ 
by Tom Moeller October 16, 2007

Industrial production nudged up minimally last month. The 0.1% rise followed no change in August. The September gain matched Consensus expectations.

Factory output fared no better and posted no change after an unrevised 0.3% August decline.

A 0.4% decline (+1.7% y/y) in the output of consumer goods led last month's decline in output. It mostly reflected a 2.8% (+1.7% y/y) drop in the production of automotive products. Output of appliances, furniture & carpeting showed no change but the 3.0% y/y decline reflected the continued weakness in the housing industry. Output of construction supplies fell 0.2% (-0.7% y/y) for the third consecutive monthly decline.

Returning to the consumer goods sector, production of computers & electronics rose 0.2% (13.8% y/y) after two consecutive monthly declines. Apparel output inched up 0.1% (-2.3% y/y) after the huge 2.0% drop during August. Chemical products output rose 0.5% (0.4% y/y).

Output of business equipment recovered all of the moderate August decline with a 0.5% (+4.1% y/y) rise. That increase was led by a 0.8% (9.0% y/y) gain in the output of information & processing equipment. Production of industrial equipment also rose a moderate 0.4% (1.4% y/y) but that only recovered a piece of the prior month's 1.2% drop.

In the materials category, output increased 0.3% (2.1% y/y) but production of durable consumer parts fell 1.9% (-2.3% y/y). That decline was made up by 0.3% increases in the production of durable equipment parts (6.4% y/y) and other durable goods materials output (0.15 y/y) although the trends in these two sectors is very much down.

Capacity utilization was unchanged from August at 82.1%, up slightly from last year's average of 81.7%. Utilization in the factory sector fell m/m to 80.4% versus an average 80.5% last year. Capacity rose 0.1% (1.9% y/y).

The Recent Financial Turmoil and its Economic and Policy Consequences is yesterday's speech by Federal Reserve Board Chairman Ben S. Bernanke and it can be found here.

Financial Market Frictions from the Federal Reserve Bank of Atlanta is available here.

INDUSTRIAL PRODUCTION (SA) September August Y/Y 2006 2005 2004
Total 0.1% 0.0% 2.0% 4.0% 3.2% 2.5%
Manufacturing 0.0% -0.3% 1.6% 5.0% 4.0% 3.0%
Mining 0.2% -0.6% 0.0% 2.7% -1.6% -0.6%
Utilities 0.0% 4.6% 6.5% 0.2% 2.0% 1.4%
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