U.S. Industrial Production and Manufacturing Output Up in July, Extending Growth Trend
Summary
- July IP +0.2% (+1.1% y/y), third m/m increase in four months.
- Manufacturing +0.2% (+1.2% y/y), w/ durables +0.7% and nondurables -0.4%.
- Selected high-tech +1.9%, ninth gain in 10 mths.; motor vehicles -2.1%, first m/m drop since March.
- Utilities +0.5% (+0.7% y/y), fourth straight m/m rise, led by a 0.5% gain in electric utilities output.
- Mining +0.2% (+1.0% y/y), up for the third time in four mths.
- Key categories in market groups mostly increase.
- Capacity utilization up to 76.3%, a one-year high; mfg. capacity utilization up to 76.0%, highest since June ’24.
Industrial production (IP) rose a slightly less-than-expected 0.2% m/m in July, the third monthly rise in four months, following an upwardly revised 0.3% gain in June (+0.1% initially) and no change in May (+0.1% previously), according to data from the Federal Reserve Board. A 0.3% m/m July increase had been expected in the Action Economics Forecast Survey. The year-on-year growth rate held at 1.1% in July and June (1.4% in July 2025). The July IP index at 103.0 was 3.7% above a low of 99.3 in November 2024 and 3.8% above a low of 99.2 in January 2024.
By industry groups, manufacturing production grew 0.2% (1.2% y/y) in July, the fifth m/m gain in six months, after an upwardly revised 0.3% increase in June (0.0% initially) and a flat reading in May (+0.1% previously). Durable goods production advanced 0.7% (3.9% y/y) in July, the seventh consecutive m/m rise, adding to a 0.2% increase in June. Within durables, almost all categories rose m/m in July, led by a 2.4% rebound (0.6% y/y) in wood products, followed by rises of 1.9% (9.9% y/y) in computer & electronic products, 1.4% (4.5% y/y) in aerospace & miscellaneous transportation equipment, 1.4% (1.6% y/y) in primary metals, 1.3% (6.2% y/y) in electrical equipment, appliances & components, 1.2% (2.8% y/y) in fabricated metal products, 0.8% (4.4% y/y) in machinery, 0.7% (-5.0% y/y) in furniture & related products, and 0.4% (2.8% y/y) in miscellaneous durable goods. Notably, aircraft & parts production climbed 1.6% (8.2% y/y), the sixth successive m/m rise, after a 1.0% June increase. To the downside, durable goods categories for motor vehicles & parts (-2.1%; +2.1% y/y) and nonmetallic mineral products (-0.2%; +3.8% y/y) posted m/m decreases in July.
Nondurable goods production fell 0.4% (-1.6% y/y) in July, the second m/m fall in three months, following a 0.5% increase in June. The July output decline was led by a 2.5% drop (-2.5% y/y) in printing & related support activities, followed by decreases of 1.9% (+0.5% y/y) in apparel & leather goods, 0.7% (-1.6% y/y) in food, beverages & tobacco, 0.7% (-3.5% y/y) in paper, and 0.2% (-2.9% y/y) in chemicals. To the upside, the following nondurable goods categories rose m/m in July, including output rises of 0.8% (-0.1% y/y) in textiles & product mills, 0.2% (0.3% y/y) in petroleum & coal products, and 0.2% (2.2% y/y) in plastics & rubber products.
Utilities output rose 0.5% (0.7% y/y), the fourth consecutive m/m gain and the fifth in six months, following a 0.1% uptick in June (+0.4% initially), reflecting a 0.5% increase (1.3% y/y) in electric utilities output and a 0.4% rebound (-3.0% y/y) in natural gas utilities output. Mining activity grew 0.2% (1.0% y/y), the third m/m rise in four months, after a 0.3% June increase (+0.4% initially).
By market groups, business equipment output rose 0.8% (6.6% y/y), the eighth straight m/m rise, on top of a 0.4% increase in June. Construction supplies production advanced 0.8% (2.4% y/y), the fourth m/m gain in five months, after a 0.1% June uptick. Materials production increased 0.3% (1.0% y/y), up for the third time in four months, after a 0.2% June rise. In contrast, consumer goods output fell 0.4% (-1.8% y/y) in July after a 0.3% rebound in June, reflecting declines of 1.4% (-1.6% y/y) in durable consumer goods and 0.1% (-1.8% y/y) in nondurable consumer goods.
In special classifications, factory output of selected high-tech industries strengthened 1.9% (11.8% y/y) in July after a 1.6% increase in June, marking the fourth successive m/m gain and the ninth in 10 months. Manufacturing production excluding selected high-tech industries edged up 0.1% (0.8% y/y) in July after a 0.3% rise in June, and manufacturing production excluding selected high-tech and motor vehicles & parts rose 0.3% (0.7% y/y) after a 0.2% increase; both registered the fifth m/m gain in six months.
Capacity utilization inched up to 76.3% in July, the highest since July 2025, from an upwardly revised 76.2% in June (76.1% initially). The result matched the forecast by the Action Economics Forecast Survey. The July reading was 3.1 percentage points below its long-run (1972–2025) average. Manufacturing capacity utilization edged up to 76.0% in July, the highest since June 2024, from an upwardly revised 75.9% in June (75.7% previously). The July rate was 2.2 percentage points below its long-run average.
Industrial production and capacity data are in Haver’s USECON database. Additional detail on production and capacity utilization can be found in the IP database. The expectations figures come from the AS1REPNA database.
Winnie Tapasanun
AuthorMore in Author Profile »Winnie Tapasanun has been working for Haver Analytics since 2013. She has 20+ years of working in the financial services industry. As Vice President and Economic Analyst at Globicus International, Inc., a New York-based company specializing in macroeconomics and financial markets, Winnie oversaw the company’s business operations, managed financial and economic data, and wrote daily reports on macroeconomics and financial markets. Prior to working at Globicus, she was Investment Promotion Officer at the New York Office of the Thailand Board of Investment (BOI) where she wrote monthly reports on the U.S. economic outlook, wrote reports on the outlook of key U.S. industries, and assisted investors on doing business and investment in Thailand. Prior to joining the BOI, she was Adjunct Professor teaching International Political Economy/International Relations at the City College of New York. Prior to her teaching experience at the CCNY, Winnie successfully completed internships at the United Nations. Winnie holds an MA Degree from Long Island University, New York. She also did graduate studies at Columbia University in the City of New York and doctoral requirements at the Graduate Center of the City University of New York. Her areas of specialization are international political economy, macroeconomics, financial markets, political economy, international relations, and business development/business strategy. Her regional specialization includes, but not limited to, Southeast Asia and East Asia. Winnie is bilingual in English and Thai with competency in French. She loves to travel (~30 countries) to better understand each country’s unique economy, fascinating culture and people as well as the global economy as a whole.
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