August 17, 2017 – The Industrial Production Index (IPI) measures the manufacturing, electric, mining, and gas industries output on a monthly basis.
Industrial production increased 0.2% in July, below the consensus of 0.3%. Manufacturing decreased 0.1%, below expectations of 0.2% gains while the capacity utilization rate came in at 76.7%, in line with estimates. Mining is up 0.4% and utilities are up 1.6%, while motor vehicles are down 3.6%.
July’s 0.2% increase continues the IPI’s trend of growth since January 2017. The lowering unemployment level could be playing a key role in the steady increase of industrial production. More people are filling vacant jobs, therefore increasing productivity of companies leading to higher industrial production. The capacity utilization rate remained relatively flat at 76.7%, allowing production to flow smoothly through factories. Utilities held up IPI while business equipment and construction supplies dragged down in July.