Navigating Through the Turbulent Waters: Analyzing the Decline in U.S. Industrial Output and its Economic Impact,
Published / Modified Sep 17 2024
Source: The Federal Reserve, CSIMarket Team / CSIMarket.com
The latest report from the Federal Reserve on Industrial Production and Capacity Utilization has revealed a decline in the output of the nation's factories, mines, and utilities.
In August, U.S. industrial output decreased by -0.6%, leading to a decrease in capacity utilization to 77.8%. Over the past 12 months, the output of these sectors has decreased by the same percentage.
Capacity utilization of nondurable goods manufacturers has dropped significantly to 70.3%, with notable decreases in industries such as plastics and rubber products (-1.7%), chemicals (-0.5%), and petroleum and coal (-0.9%).
The manufacturing of durable goods has also seen a decline, particularly in auto assemblies (-3%) and on a seasonally adjusted basis (-1.1%).
However, there is some positive news in the mining sector, as output has rebounded with a 0.5% increase on a seasonally adjusted basis and high capacity utilization of 88.8%. This could potentially lead to further price increases in commodities and inflation as producers pass on raw materials prices to consumers.
Mining output has increased by 1.2% from July 2023.
Overall, the recent decline in industrial production and capacity utilization could have a significant impact on the U.S. economy, affecting sectors such as manufacturing and mining.
It will be important to monitor these trends closely in the coming months to assess the full extent of their impact on economic growth and inflation rates.
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