Wednesday, June 16, 2010

Industrial Production, Capacity Utilization increase in May

by Bill McBride on 6/16/2010 09:25:00 AM

From the Fed: Industrial production and Capacity Utilization

Industrial production advanced 1.2 percent in May after having risen 0.7 percent in April. Manufacturing output climbed 0.9 percent last month, its third consecutive monthly gain of about 1 percent, and was 7.9 percent above its year-earlier level. Outside of manufacturing, the output of mines edged down 0.2 percent, and the output of utilities increased 4.8 percent. The jump in utilities reflected unseasonably warm temperatures that boosted air conditioning usage in May after uncharacteristically temperate weather in April reduced heating demand. ... The capacity utilization rate for total industry rose 1.0 percentage point to 74.7 percent, a rate 6.2 percentage points above the rate from a year earlier but 5.9 percentage points below its average from 1972 to 2009.
Capacity Utilization Click on graph for larger image in new window.

This graph shows Capacity Utilization. This series is up 9.4% from the record low set in June 2009 (the series starts in 1967).

Capacity utilization at 73.7% is still far below normal - and 7.2% below the the pre-recession levels of 80.5% in November 2007.

Note: y-axis doesn't start at zero to better show the change.

Industrial ProductionThe second graph shows industrial production since 1967.

This is the highest level for industrial production since Nov 2008, but production is still 7.9% below the pre-recession levels at the end of 2007.

Still a long way to go.