Industrial Production Index

Industrial Production Index

July 14, 2017 – The Industrial Production Index (IPI) measures the manufacturing, electric, mining, and gas industries output on a monthly basis.

Industrial production increased 0.4% in June, above consensus of 0.3% and above May’s upward revision of 0.1%. Manufacturing increased 0.2%, in line with expectations while the capacity utilization rate came in at 76.6%, below estimates. Mining is up 1.6% and vehicle manufacturing is up 0.7%, while utility output remained unchanged.

The IPI displays how much factories, mines and utilities are producing each month and can help show turning points for the economy. While strong numbers in industrial production leads to healthy economic growth, the IPI has a strong trend of growth since January 2017. Mining was the main cause for the increase in industrial production for June followed by manufacturing. The capacity utilization rate remains at a safe rate of 76.6%. When the rate exceeds 85%, it can lead to future price increases.

Industrial Production Index