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Last Update: 15-Feb-12 12:04 ET
Soft Utilities Demand Offsets Strong Manufacturing Growth and Leads to Lower Production Numbers
Industrial production growth was flat in January after increasing an upwardly revised 1.0% (from 0.4%) in December. The Briefing.com consensus expected industrial production to increase 0.6%.
The weakness in the January industrial production numbers is not the result of disappointing data. In fact, the manufacturing production numbers were solid, increasing 0.7% in January.
Instead, the lack of growth in January can be blamed on temporary factors, such as warmer-than-usual temperatures that lowered demand for heating. That led to a 2.5% decline in utilities production. At the same time, mining production fell 1.8%. We expect these sectors to rebound within the next couple of months.
More than half of the gain in manufacturing in January was due to strong growth (6.8%) in the automotive sector. Motor vehicle assemblies increased from 9.40 mln SAAR in December to 10.17 mln SAAR in January. That is the most vehicles assembled since February 2008.
Excluding motor vehicles, manufacturing production increased 0.3%.
Nondurable manufacturing declined 0.2% in January on a 2.3% drop in petroleum and coal products production.
The weakness in the January industrial production numbers is not the result of disappointing data. In fact, the manufacturing production numbers were solid, increasing 0.7% in January.
Instead, the lack of growth in January can be blamed on temporary factors, such as warmer-than-usual temperatures that lowered demand for heating. That led to a 2.5% decline in utilities production. At the same time, mining production fell 1.8%. We expect these sectors to rebound within the next couple of months.
More than half of the gain in manufacturing in January was due to strong growth (6.8%) in the automotive sector. Motor vehicle assemblies increased from 9.40 mln SAAR in December to 10.17 mln SAAR in January. That is the most vehicles assembled since February 2008.
Excluding motor vehicles, manufacturing production increased 0.3%.
Nondurable manufacturing declined 0.2% in January on a 2.3% drop in petroleum and coal products production.
