July 2015 Industrial Production, Capacity Utilization and Capacity

Click image for larger version

Total industrial production (IP) 0.6% in July (+0.4% expected) after moving up 0.1% in June. In July, manufacturing output advanced 0.8% primarily because of an increase in motor vehicle assemblies. The output of motor vehicles and parts jumped 10.6%, and production elsewhere in manufacturing edged up 0.1%. The index for mining rose 0.2%, while the index for utilities fell 1.0%. At 107.5% of its 2012 average (the comparison base year for IP, capacity and capacity utilization was advanced to 2012 in the annual revision to the statistics published on July 21, 2015.), total IP in July was 1.3% above its year-earlier level. Wood Products and Paper output rose, respectively, by 1.4% (-2.3% YoY) and 1.0% (-0.1% YoY). 

Click image for larger version 

Click image for larger version 

Click image for larger version

Capacity utilization (CU) for the industrial sector increased 0.4% in July (-0.4% YoY) to 78.0%, a rate that is 2.1 percentage points below its long-run (1972–2014) average. Wood Products CU increased by 1.2% (-4.7% YoY) to 68.3%; Paper rose by 1.0% (+0.8% YoY) to 83.2%. 

Click image for larger version

Capacity at the all-industries and manufacturing levels moved higher -- All-industries: +0.1% (+1.7% YoY) to 137.8% of 2012 output; Manufacturing: +0.1% (+1.2% YoY) to 138.4%. Wood Products extended the upward trend that has been ongoing since November 2013 when increasing by 0.2% (+2.4% YoY) to 159.2%. Paper was unchanged (-0.9% YoY) at 116.9%.

The foregoing comments represent the general economic views and analysis of Delphi Advisors, and are provided solely for the purpose of information, instruction and discourse. They do not constitute a solicitation or recommendation regarding any investment.