The headlines say seasonally adjusted Industrial Production (IP) marginally declined. Econintersect‘s analysis is slightly better  – but the unadjusted rolling averages also marginally declining from last month. 

  • Headline seasonally adjusted Industrial Production (IP) decreased 0.1% month-over-month and up 4.0% year-over-year.
  • Econintersect‘s analysis using the unadjusted data is that IP growth was unchanged month-over-month, and is up 4.0% year-over-year.
  • The unadjusted year-over-year rate of growth decelerated 0.1% from last month using a three month rolling average, and is up 4.0% year-over-year. 
  • The market was expecting:
    •  Headline Seasonally Adjusted Consensus Range Consensus Actual IP (month over month change) -0.1 % to 0.4 % 0.2%  -0.1% Capacity Utilization 79.0 % to 79.4 % 79.3% 78.9%  IP Subindex Manufacturing (month over month change) 0.2 % to 0.4 % +0.3% +0.2% 

     

    IP headline index has three parts – manufacturing, mining and utilities – manufacturing was up 0.2% this month (up 3.4% year-over-year), mining down0.9% (up 9.9% year-over-year), and utilities were down 0.7% (down 1.3% year-over-year). Note that utilities are 9.8% of the industrial production index, whilst mining is 15.9%.

    Comparing Seasonally Adjusted Year-over-Year Change of the Industrial Production Index (blue line) with Components Manufacturing (red line), Utilities (green line), and Mining (orange line)

    Unadjusted Industrial Production year-over-year growth for the past 12 months has been between 2% and 4% – it is currently 4.0%. It is interesting that the unadjusted data is giving a smooth trend line.

    Year-over-Year Change Total Industrial Production – Unadjusted (blue line) and the Unadjusted 3 month rolling average (red line)

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