Wednesday, December 14, 2016

Industrial Production declined 0.4% in November

by Bill McBride on 12/14/2016 09:25:00 AM

From the Fed: Industrial production and Capacity Utilization

Industrial production declined 0.4 percent in November after edging up 0.1 percent in October. In November, manufacturing output moved down 0.1 percent, and mining posted a gain of 1.1 percent. The index for utilities dropped 4.4 percent, as warmer-than-normal temperatures reduced the demand for heating. At 103.9 percent of its 2012 average, total industrial production in November was 0.6 percent lower than its year-earlier level. Capacity utilization for the industrial sector decreased 0.4 percentage point in November to 75.0 percent, a rate that is 5.0 percentage points below its long-run (1972–2015) average.
emphasis added
Capacity Utilization Click on graph for larger image.

This graph shows Capacity Utilization. This series is up 8.3 percentage points from the record low set in June 2009 (the series starts in 1967).

Capacity utilization at 75.0% is 5.0% below the average from 1972 to 2015 and below the pre-recession level of 80.8% in December 2007.

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

Industrial Production The second graph shows industrial production since 1967.

Industrial production declined in November to 104.2. This is 18.9% above the recession low, and is close to the pre-recession peak.

This was below expectations of a 0.2% decrease.