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US Industrial Production Growth Stalls

James Boston
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US Industrial Production Growth Stalls

A good overview of the state of the US manufacturing and industrial sector has been provided today with the publication of a range of economic updates. The headline figure is the Industrial Production number, this has been steadily rising over the past few months but today comes in at a stable reading of 4.3% growth on a year on year basis, this has levelled off at the figure of 4.3% recorded in May and a market expectation for a reading of just 3.7% in June. Month on month this number is off slightly, at 0.2% it misses the prior months print of 0.5% and falls short of the market consensus expectation for 0.4% growth.

Manufacturing Production data can be split out from this to yield a year on year growth number of 3.5%, down from the 3.6% experienced in May but ahead of the expected 2.5% market prediction.

The Capacity Utilization figure has risen for the month or June. This is still showing at 79.1%, identical to the level recorded in May, markets had forecast this number to read at around 79.3% this month.

On the manufacturing cost side the Producer Price Index (PPI) is tracking lower this month. The year on year figure for June has been announced as 1.9% growth, this is in comparison to the May number of 2.0% and in line with a market expectation of 1.9%. Month on month this number is 0.4%, recovering from May’s -0.2% contraction and easily beating analysts expectations for a rise of 0.2%.

The Core PPI numbers closely reflect the wider figures. The year on year growth to June in the Core measure is now showing at 1.8%, this compares to the May level of 2.0% and a market expectation for 1.7% expansion. Month on month this number is now 0.2% in comparison to the -0.1% drop the previous month and the markets expected level of 0.2% expansion.

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