Manufacturing output increased 0.7% in June, and the May level was revised up, according to a Federal Reserve report released this morning.
Industrial production rose 0.8% in June, which was 4.5% higher than its level for the same time period one year ago. Output at mines and utilities also noted gains. Total output increased at an annual rate of 6.6%, and manufacturing output rose at a 5.4% pace for the second quarter of 2006. Capacity utilization for the entire industry rose to 82.4% in June, which indicated a 2.1% increase from its level in June 2005.
The production of durable goods increased 1.0%. Production of aerospace and miscellaneous transportation equipment increased 0.7%. The output of nondurable goods increased 0.3% in June, with the largest contributors from petroleum and coal products, chemicals, and plastics and rubber products. The output of non-NAICS manufacturing industries (publishing and logging) rose 1.2%.“The 0.8 percent increase in June industrial production and 0.7 percent gain in manufacturing production show that the industrial sector is surprisingly strong,” said Daniel J. Meckstroth, Chief Economist for the Manufacturers Alliance/MAPI. “Part of June production’s strength was a rebound from only 0.1 percent growth the previous month. For the second quarter as a whole manufacturing production has grown at a 5.4 percent annual rate (slightly exceeding the 5.3 percent annual rate in the first quarter). While the second quarter GDP is widely expected to have slowed appreciably, the industrial sector continues to expand at a rapid pace. The June report indicates that the production of capital goods and metals is driving the strong pace of growth and there are very few pockets of industrial weakness.”The entire report can be found at: http://www.federalreserve.gov/RELEASES/g17/Current/.