Recent Updates

  • Canada: Employment Insurance (Mar), Industrial Production & Raw Material Prices (Apr)
  • Mexico: Manufacturing Employment (Mar)
  • Latvia: Labor Force Statistics (Apr)
  • UK: CBI Industrial Trends Survey (May)
  • more updates...

Economy in Brief

U.S. Industrial Output Fell Hard Last Month
by Tom Moeller May 15, 2008

Industrial production fell a sharp 0.7% last month after a little revised increase of 0.2% during March. The decline was close to the largest since September 2005 and it was more than double Consensus expectations for a 0.3% drop.

Factory output fell a slightly sharper 0.8% after no change during March. Output has now fallen 1.8% since its peak in July of 2007 and the three month rate change was a negative 5.8% (AR).

Production in the high tech sector continued strong and rose 1.0% (24.5% y/y) while the three month rate of change amounted to 23.5%. Production of computers & office equipment rose a lesser 0.5% and three month growth totaled 9.8% (AR). Output of communications equipment rose an even stronger 2.1%. The three month rate of growth was 27.5%.

The trend in output outside the high tech sector has been decidedly different and one of weakness. Less high tech, factory output fell 0.9% last month and three month output growth fell to -7.6% (AR). Output of motor vehicles & parts has been notably weak and fell 8.2% last month, at a -43.5% annual rate during the last three months. Furniture output also fell 0.7% last month and at a hard 10.2% rate during the last three. Electrical equipment fell 0.8% during April and at a 2.6% rate during the last three months. Machinery output also was quite weak and fell 1.7% and at a three month rate of -9.1%

In the nondurables area the picture is little better. Output ticked down 0.1% last month and at a 3.3% rate during the last three. Though apparel output rose 0.1% last month it followed sharp declines during the prior three. Three month annual growth was -7.0%. Paper output has been falling at an 8.9% rate during the last three months and chemical output is off at a 3.4% rate.

Capacity utilization fell sharply to 79.7% during April but utilization in the factory sector slipped even further to 77.5%, its lowest also since late 2004. Utilization rates in the durables industries outside of high tech were notably weak, exemplified by the machinery industry where utilization fell to 74.6% versus 81% nearly two years ago. Overall capacity grew 1.8% during the last year and 2.0% in the factory sector. Less high tech, factory capacity grew a lower 0.9% over the last year.

Risk Management in Financial Institutions is today's speech by Fed Chairman Ben S. Bernanke and it is available here.

INDUSTRIAL PRODUCTION (SA) April March Y/Y 2007 2006 2005
Total -0.7 0.2 0.2 1.7 2.2 3.3
  Manufacturing -0.8 0.0 -0.3 1.7 2.4 4.0
  Utilities 0.4 0.7 0.8 3.3 -0.6 2.1
large image