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Economy in Brief

Industrial Production Up Slightly, Factory Output Firm
by Tom Moeller September 15, 2004

Industrial production rose just 0.1% following an upwardly revised 0.6% gain in July. Market forecasters had looked for a 0.5% increase but the disappointment was that utility output fell 2.4% and mining output fell 1.1%.

Production in the factory sector rose 0.5% (6.7% y/y) last month following an upwardly revised 0.8% gain in July.

Output of motor vehicles jumped 3.7% (6.1% y/y) following declines in each of the prior five months. Less motor vehicles factory output rose 0.3% (6.8% y/y) in August. The high tech sector continued strong with a 1.8% (23.7% y/y) rise.Factory output elsewhere (excluding motor vehicles & high tech) rose 0.2% (5.7% y/y) following a 0.9% gain in July.

Total capacity utilization was stable at an upwardly revised 77.3%. Growth in capacity inched up to 1.4% y/y from 1.1% earlier this year.

"Predicting the Recent Behavior of Inflation Using Output Gap-Based Phillips Curves" from the Federal Reserve Bank of Richmond is available here.

Production & Capacity August July Y/Y 2003 2002 2001
Industrial Production 0.1% 0.6% 5.1% 0.3% -0.6% -3.4%
Capacity Utilization 77.3% 77.3% 74.5%(8/03) 74.8% 75.6% 77.4%
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