Industrial Production & Manufacturing Capacity Utilization

Both these data points are reported in the Federal Reserve G17 data base. The IP index (industrial production) was reported as 99.36 for August, up from 98.96 in July. This was an increase of 0.4 percent and moved the 3MMA up by 0.17 percent. Growth of the 3MMA was 2.0 percent year over year reversing a three month slide. The IP index in August was the highest since March 2008 (Figure 1). This is still the least up-beat of the manufacturing indicators so its reversal is a welcome sign.

Manufacturing capacity utilization was 76.13 percent in August up from 75.73 percent in July. The 3MMA rose from 75.92 to 75.99 percent which is the same as it was in April last year (Figure 2).
 
Every three months, the Manufacturers Alliance for Productivity and Innovation (MAPI) provides a detailed look at the health of the domestic manufacturing sector and reviews the performance of a selected group of its most important subsectors. The September 10th report covers the actual data available through July 2013. Manufacturing industrial production declined at a 0.8 annual rate in the second quarter of 2013 and fell at a 1 percent annual rate in July. The decline in manufacturing activity was a correction for the exceptionally strong pace of production in the first quarter (5.2 percent annual rate) and not a precursor of a general slump. Manufacturing simply got ahead of the sluggish performance of the overall economy and went through an adjustment period to realign orders and production.