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industrial production Archives - Shopfloor

Manufacturing Production Began 2018 Unchanged but Still Reflects Progress, up 1.8 Percent Year-Over-Year

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The Federal Reserve said that manufacturing production was unchanged in January for the second straight month. As such, output in the sector essentially has taken a pause at the beginning of 2018, but we would anticipate that breather to be short-lived. Indeed, we would expect manufacturing production to rise by 2.1 percent in 2018, up from 1.7 percent in 2017. In terms of the latest data, manufacturing production rose by 1.8 percent since January 2017, slowing from the more robust 2.3 percent pace seen in November, which likely represented a rebound in the aftermath of several hurricanes. Much like the headline number, manufacturing capacity utilization was flat in January’s report, unchanged at 76.2 percent. Read More

Manufacturing Production Rose for the Fourth Straight Month in December, up 2.4 Percent Year-Over-Year

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The Federal Reserve said that manufacturing production rose for the fourth straight month in December, edging up by 0.1 percent. While this was slower than the 0.3 percent gain seen in November and while we might prefer increases that were more broad-based for the month, the data remain encouraging overall. Indeed, manufacturing production has risen by 2.4 percent over the past 12 months, down from 2.5 percent in November, which was the best year-over-year rate since July 2014. In a similar manner, manufacturing capacity utilization matched November’s rate of 76.4 percent, a reading not seen since May 2008. Read More

Manufacturing Production Edged Higher in September but Still Exhibits Hurricane-Related Softness

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The Federal Reserve reported that manufacturing production edged up 0.1 percent in September, bouncing back ever so slightly from declines across the past two months. With that said, the data continue to reflect softness due to the hurricane-related reductions in activity from Hurricanes Harvey and Irma, and the Federal Reserve estimates that this subtracted 0.25 percentage points from growth in the month.

Beyond weather, we have seen a lot of volatility in the output data for the manufacturing sector since March, essentially seesawing from month to month. This has meant that production has grown less than desired or expected, especially given the more robust outlook in other data sources. As a result, manufacturing production has risen 1.0 percent over the past 12 months. While this is better than last year—when the year-over-year rate registered -0.1 percent—a faster pace of growth is preferable. Indeed, the year-over-year pace has drifted lower since April’s 1.8 percent rate.

Manufacturing capacity utilization remained the same at 75.1 percent in September. Utilization rates have trended down since peaking at 76.0 percent in April, but capacity continues to be slightly higher than the 74.9 percent rate seen at this time last year.

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Manufacturing Production Disappointed in August

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The Federal Reserve said that manufacturing production fell 0.3 percent in August, pulling back from being flat in July and declining for the first time since May. We have seen a lot of volatility in the output data for the manufacturing sector since the spring—essentially seesawing from month to month since March. This has meant that production has grown been less than we would have desired or expected, especially given the more-robust outlook seen in other data sources. In the August data, though, the main culprit was Hurricane Harvey, which the Federal Reserve estimates reduced production by 0.75 percent in August.

Yet, even with that weakness, the longer-term trend for output among manufacturers has been encouraging. Over the course of the past 12 months, manufacturing production has risen 1.5 percent. It was the tenth consecutive positive year-over-year reading for manufacturing output and definite progress from decline of 0.6 percent year-over-year seen in August 2016. Similarly, manufacturing capacity utilization decreased from 75.6 percent in July to 75.3 percent in August. Utilization rates have trended lower since peaking at 75.9 percent in April, but capacity continues to exceed the 74.7 percent rate seen at this time last year.

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Manufacturing Production Rebounded Somewhat in June

By | Economy, Shopfloor Economics, Shopfloor Main | No Comments

The Federal Reserve reported that manufacturing production rebounded in June, up 0.2 percent, after falling in two of the three prior months. Overall, springtime production in the sector was choppier than we would have desired or expected, especially given the more robust outlook in other data sources. Yet, even with some disappointment in recent months, the longer-term trend for output among manufacturers has been quite positive. Across the past 12 months, manufacturing production has risen 1.2 percent. It was the eighth consecutive positive year-over-year reading for manufacturing output and progress from the 0.2 percent year-over-year gain in June 2016. Similarly, manufacturing capacity utilization inched up from 75.3 percent in May to 75.4 percent in June. For comparison purposes, utilization in the sector was 75.1 percent one year ago. Read More

Manufacturing Production Fell in May for the Second Time in the Past Three Months

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The Federal Reserve said that manufacturing production fell for the second time in the past three months, down 0.4 percent in May. After rebounding strongly in April, up 1.1 percent, this latest figure is a bit of a disappointment, suggesting a softening of activity following recent progress. Motor vehicles and parts production led the decline in May, down 2.0 percent for the month and off 1.5 percent year to date, as automotive demand has continued to be weaker than desired so far in 2017. Despite the easing in this latest release and some lingering challenges, the underlying data remain consistent with a manufacturing sector that has turned a corner and has moved in the right direction, especially relative to where it stood at this point last year.

Manufacturing production has risen 1.4 percent over the past 12 months, down from 1.6 percent in the previous report. Yet, it was the seventh consecutive positive year-over-year reading for manufacturing output and definite progress from the 0.3 percent year-over-year decline in May 2016. Similarly, manufacturing capacity utilization declined from 75.8 percent in April to 75.5 percent in May. For comparison purposes, utilization in the sector was 75.0 percent one year ago.

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Manufacturing Production Pulled Back in March, Ending Six Straight Monthly Gains

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The Federal Reserve reported that manufacturing production pulled back in March, ending six straight monthly gains. Output in the sector declined 0.4 percent, pulled lower by a sharp reduction in motor vehicles and parts production, down 3.0 percent, among others. Yet, even with the reduced figures in March, the data continue to reflect improvements in the manufacturing sector, with activity turning a corner after struggling for much of the past two years due to a number of economic headwinds. Indeed, manufacturing production has increased 0.8 percent over the past 12 months, down from 1.0 percent in the prior release but with progress from declining year-over-year rates as recently as October. Similarly, manufacturing capacity utilization decreased from 75.6 percent—a 13-month high—to 75.3 percent. In general, the utilization rate has trended higher since bottoming out at 74.7 percent in August. Read More

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