U.S. industrial production makes gains

U.S. industrial production is ahead of expectations, but still digging itself out of a large hole, according to new figures from the Federal Reserve.

Industrial production in the United States rose 0.4 percent in September, partially reversing a 1.4 percent drop in August, according to new figures from the U.S. Federal Reserve.

The play-by-play:

  • Industrial production declined at an annual rate of 0.4 percent for the third quarter.
  • Manufacturing output increased 0.2 percent in September but is down at an annual rate of 0.9 percent in Q3.
  • Production at mines ticked up 0.9 percent in September.
  • The output of utilities moved up 1.5 percent in September.
  • Total industrial production in September was 2.8 percent above the same time a year ago, but it's still 97 percent of the 2007 average.
  • Across all industries, capacity utilization moved up a smidge to 78.3 percent. That's two percentage points below its average between 1972 and 2011.

The Fed attributes about three-tenths of a percentage point of the decline in August to precautionary idling of production along the Gulf of Mexico in anticipation of Hurricane Isaac; part of the rise in September is attributed to those facilities coming back online.

Other production statistics of note:

  • Consumer goods: unchanged in September after having fallen 1.5 percent in August.
  • Automotive products: fell 2.9 percent, a second consecutive large decline.
  • Home electronics and miscellaneous goods posted small declines.
  • Appliances, furniture and carpeting moved up.
  • Consumer energy products rose 0.8 percent after having fallen 2.7 percent in August.
  • Business equipment moved up 0.8 percent in September and was nearly 11 percent above its year-earlier level.
  • Transit equipment rose 1.7 percent in September after having dropped 3.3 percent in August. (September's gain was helped by an increase in the production of civilian aircraft.)
  • Information processing equipment moved up 0.5 percent.
  • Defense and space equipment gained 1.7 percent in September, helping the third quarter's 7 percent gain "more than reverse" a 5.7 percent decline in the second quarter.
  • Energy materials rose 0.9 percent following a large drop in August related to reduced oil and natural gas extraction in anticipation of Hurricane Isaac.

What it all means: U.S. industrial production is ahead of expectations, but still digging itself out of a large hole.

This post was originally published on Smartplanet.com


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