The Federal Reserve reported that manufacturing production rose for the third straight month in November, up 0.2 percent. This extended a 1.4 percent gain in October, which jumped significantly on rebounds related to recent hurricanes.
With that said, the increase in the latest figures stemmed mostly from higher production for durable goods firms, up 0.4 percent in November, with output from nondurable goods manufacturers unchanged for the month. The data have seesawed from month to month since the spring, but it is hoped the sector can build from recent momentum.
Indeed, manufacturing production has risen 2.4 percent over the past 12 months, matching the rate in October, with both being the best year-over-year since July 2014. In a similar manner, manufacturing capacity utilization inched up from 76.3 percent in October to 76.4 in November, a reading not seen since May 2008.
The underlying data in November provided mixed results. The largest gains in the manufacturing sector included plastics and rubber products (up 1.7 percent), primary metals (up 1.7 percent), computer and electronic products (up 0.7 percent), fabricated metal products (up 0.7 percent), machinery (up 0.7 percent) and electrical equipment and appliances (up 0.5 percent), among others. In contrast, output declined for apparel and leather (down 1.0 percent), textile and product mills (down 0.7 percent), wood products (down 0.6 percent), nonmetallic mineral products (down 0.5 percent) and petroleum and coal products (down 0.5 percent).
Meanwhile, similar to manufacturing, total industrial production also increased 0.2 percent in November, slowing after the 1.2 percent rebound in October. In addition to manufacturing, mining production rose strongly, up 2.0 percent for the month. On the other hand, utilities output decreased 1.9 percent. Recent hurricanes also fueled the volatility in these data points.
Over the past 12 months, industrial production has risen 3.4 percent, a three-year high. Mining and utilities output increased 9.4 percent and 2.3 percent year-over-year, respectively, in the latest data. In addition, capacity utilization edged up from 77.0 percent to 77.1 percent, its strongest rate since April 2015.
Chad Moutray
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