Industrial production increased 0.4 percent in August
As reported by the Federal Reserve on Sept. 15, industrial production increased 0.4% in August after moving up 0.8% in July.
As reported by the Federal Reserve on Sept. 15, industrial production increased 0.4 percent in August after moving up 0.8 percent in July. Late-month shutdowns related to Hurricane Ida held down the gain in industrial production by an estimated 0.3 percentage points. Although the hurricane forced plant closures for petrochemicals, plastic resins and petroleum refining, overall manufacturing output rose 0.2%. Mining production fell 0.6%, reflecting hurricane-induced disruptions to oil and gas extraction in the Gulf of Mexico. The output of utilities increased 3.3%, as unseasonably warm temperatures boosted demand for air conditioning.
At 101.6% of its 2017 average, total industrial production in August was 5.9% above its year-earlier level and 0.3% above its pre-pandemic (February 2020) level. Capacity utilization for the industrial sector rose 0.2 percentage point in August to 76.4%, a rate that is 3.2 percentage points below its long-run (1972-2020) average.
Almost all major market groups posted increases in August, buoyed by strength in the output of utilities. Among consumer goods, the production of durables and non-energy nondurables increased modestly, while the index for consumer energy products moved up 2.5%. The output of business equipment, construction supplies and business supplies posted gains of around .50 to .75 percent. The production of materials edged up, as an increase for energy materials offset a decrease for non-energy materials.
Despite an estimated drag of 0.2 percentage point due to Hurricane Ida, manufacturing output increased 0.2 percent in August and was 1.0% above its pre-pandemic level. The production of durable goods edged up in August; among its industries, the largest gain was recorded by furniture and related products and the largest loss was recorded by electrical equipment, appliances, and components. The output of nondurable goods also edged up, with gains for food, beverage and tobacco products, for paper, and for petroleum and coal products outweighing losses elsewhere, in particular for chemicals. The output of other manufacturing (publishing and logging) rose 2.4%.
Capacity utilization for manufacturing increased 0.1 percentage point in August to 76.7%. The operating rate for mining fell 0.4 percentage point to 76.1%, while the operating rate for utilities rose 2.3 percentage points to 75.6%. The rates for all three sectors remained below their long-run averages.
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