The Chicago Federal Reserve Bank said that manufacturing activity in the Midwest picked up in June. The Midwest Manufacturing Index increased 0.4 percent in June, reversing declines in both April and May. In general, growth in ouptut in the Fed district has been sluggish so far in 2013, with the index up 0.8 percent since December. On a year-over-year basis, the data have been better, up 3.5 percent.
That annual pace was nearly double the national rate, with industrial production increasing 1.8 percent for manufacturers country-wide. This has largely been due to gains in the auto sector, which grew a robust 7.3 percent over the past 12 months. Motor production in June was up a more modest 0.1 percent in June, however. The other driver of growth in the district was the resource sector, which had output growth of 3.3 percent year-over-year. The Chicago Fed includes the following in the resource sector: food, wood products, paper, chemicals, and nonmetallic mineral products.
The Midwest Manufacturing Index noted higher levels of activity across-the-board. In addition to autos, there was increased activity in the machinery (up 0.4 percent), resource (0.4 percent), and steel (up 0.3 percent). Over the past 12 months, the steel sector has grown 1.4 percent; whereas, the machinery segment has struggled, with 1.1 percent less output since June 2012.
Chad Moutray is the chief economist, National Association of Manufacturers.
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