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Economic Watch: Industrial Production Bounces Back Slightly

Industrial production in the U.S. increased 0.1% in February from the month before, but is 3.5% higher than the same time a year ago.

The U.S. Federal Reserve also reported on Monday that January’s figure was revised downward from a 0.2% gain in  December to a 0.3% decline.

During February, manufacturing output moved down 0.2% from January, its third consecutive monthly decline. The production of durable goods fell 0.6 %, with widespread losses among its components, and the production of nondurable goods increased 0.2%. The motor vehicles and parts industry posted a loss of 3.0%, the largest decrease among durable goods manufacturers. Most other industries moved down more than 0.5%

Mining output declined 2.5%, due to drop in coal miming along with oil and gas well drilling, while the output of utilities jumped 7.3%, as especially cold temperatures drove up demand for heating.

Capacity utilization for the industrial sector decreased 0.2 of a percentage point to 78.9% in February, a rate that is 1.2 percentage points below its long-run average from 1972 to 2014, which has slowly recovered since the Great Recession, but hasn’t been above 80% since before the economic downturn.

According to Bloomberg Business, the overall decline, was likely due to delays at West Coast ports, which stemmed from labor problems, along with sluggish growth in economies overseas and the increased value of the U.S. dollar, making U.S. produced goods more expensive in other countries.

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