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Economy in Brief

U.S. Industrial Production Continues to Soften
by Tom Moeller  October 16, 2015

Overall industrial output eased 0.2% during September (+0.4% y/y) following a 0.1% dip in August, last month reported as -0.4%. The latest decline matched expectations in the Action Economics Forecast Survey. Manufacturing sector production dipped 0.1 % (+1.3% y/y) following a 0.4% fall. Mining output was off 2.0% (-5.7 % y/y), the most since May. Utility output gained 1.3% (1.0% y/y) for a second straight month.

Within the factory sector, motor vehicle & parts production improved 0.2% (9.4% y/y) after a 5.4% slump. Output of computers & electronic products fell 0.2% (+0.7% y/y) after a 0.2% rise. Appliance, furniture & carpeting output eased 0.3% (+1.6% y/y) after a 0.7% fall. Business equipment production dipped 0.1% (+1.8% y/y) after a 0.6% rise. In the nondurables consumer goods sector, output rose 0.4% (1.9% y/y) as food products production increased 0.7% (2.3% y/y). Clothing output gained 0.1% both m/m and y/y after a 0.2% decline. Chemical product manufacturing also improved 0.1% (2.5% y/y) after a 0.2% decline.

The special aggregate series indicated that production in high technology industries declined 0.5% (-1.1% y/y) after a 0.4% drop. Computers & office equipment production fell 1.5% (+7.7% y/y) and communications equipment production eased 0.5% (+1.7% y/y). Manufacturing production excluding both high-tech and autos slipped 0.1% (+0.9% y/y).

The capacity utilization rate declined to 77.5% and remained below the recovery high of 79.0% reached in November. Mining sector utilization moved lower m/m to 81.9% and remained down from its 91.7% high reached in December. In the factory sector, the capacity utilization rate backpedaled m/m to 75.9% and has moved sideways since the middle of last year. Industrial capacity increased 1.2% y/y.

Industrial production and capacity data are included in Haver's USECON database, with additional detail in the IP database. The expectations figure is in the AS1REPNA database.

Industrial Production (SA, % Change) Sep Aug Jul Sep Y/Y 2014 2013 2012
Total Output -0.2 -0.1 0.8 0.4 3.7 1.9 2.8
Manufacturing -0.1 -0.4 1.0 1.3 2.5 0.9 2.7
    Consumer Goods 0.2 -0.4 1.6 2.7 2.2 1.5 -1.3
    Business Equipment -0.1 0.6 0.1 1.8 4.8 -0.4 9.9
    Construction Supplies -1.3 0.3 0.4 0.1 3.9 2.8 4.3
  Materials -0.3 -0.5 0.6 -0.3 5.1 3.1 4.1
Utilities 1.3 1.3 -1.4 1.0 1.0 2.5 -2.1
Capacity Utilization (%) 77.5 77.8 78.0 78.2 78.1 76.7 76.7
 Manufacturing 75.9 78.1 76.4 75.7 75.3 74.0 74.5
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