The Federal Reserve’s U.S. industrial production release reflects a mix of gains and losses in June. In the category of consumer goods, activity moved down 0.6 percent, with declines for both durables and nondurables. The output of consumer durables decreased 1.2 percent. Additionally, lower production of automotive products, as well as appliances, furniture, carpeting, and “miscellaneous goods” more than offset a gain in home electronics. The production of consumer nondurable goods decreased 0.4 percent.
The output of non-energy nondurables fell 1.5 percent, with all of the major categories for that index recording declines—except clothing. The output of consumer energy products moved up 3.5 percent as the output of residential utilities increased noticeably.
In other categories, the output of business equipment rose 0.9 percent in June and jumped at an annual rate of 15.7 percent for the second quarter as a whole—the largest quarterly increase for this category since 2005. Within business equipment, the production of transit equipment advanced 2.2 percent; elsewhere in business equipment, the index for industrial and other equipment rose 1.0 percent last month.
Defense and space equipment output moved up in June as production resumed at a factory producing military cargo planes following a well-publicized strike. Meanwhile, the output of construction supplies dipped 0.3 percent, with the output of materials to be further processed in the industrial sector increasing 0.4 percent in June, with mixed results among its major categories.
INDUSTRIAL OUTPUT AND CAPACITY UTILIZATION
Manufacturing output fell 0.4 percent in June after moving up for three consecutive months. The manufacturing index increased at an annual rate of 7.9 percent for the second quarter as a whole, a gain similar to the average quarterly increase since production turned up in the third quarter of 2009. Capacity utilization for manufacturing moved down 0.3 percentage point in June to 71.4 percent, a rate 6 percentage points above its trough in June 2009 but 7.8 percentage points below its average from 1972 to 2009.
The production index for durable goods manufacturing edged up 0.1 percent in June, with the largest increases seen in primary metals and machinery. On the downside, the largest decreases were recorded in wood products, motor vehicles and parts, and miscellaneous manufacturing. For the second quarter as a whole, durable manufacturing increased at an annual rate of 14.1 percent, with sizable gains recorded in every major category except aerospace and miscellaneous transportation equipment.
The full June U.S. industrial production report is available online.