Industrial production increased 1 percent in July after decreasing during the two previous months, according to the Federal Reserve.
Manufacturing output increased a half-percent. The indexes for durable and nondurable manufacturing rose 0.8 percent and 0.1 percent, respectively. Within the durables category, the production of motor vehicles and parts jumped 5.2 percent, while factory output elsewhere only increased by 0.1 percent.
In nondurables, the index for utilities increased 5.4 percent as hot temperatures in July raised demand for air conditioning. “Modest declines in the indexes of paper, of plastics and rubber products, and of apparel and leather were more than offset by gains elsewhere,” the report stated.
One percent gains were seen in consumer nondurables, business equipment and defense and space equipment. Publishing and logging manufacturing increased 1.3 percent. Of the Fed’s major market groups, the only decline was reported in construction supplies.
“Most major market groups recorded growth in July,” the Fed stated. “The production of consumer durables was boosted by a jump of 4.8 percent in the output of automotive products. Similarly, the abnormally hot weather in July lifted the indexes of energy consumer goods and energy materials, which advanced 3.7 percent and 2.1 percent, respectively.”
Other report findings included:
- Total industrial production, while having grown since 2017, is still 0.2 percent below its year-ago mark.
- Capacity utilization for manufacturing increased to 77.8 percent last month, which is 0.4 percent percentage points under its historical average.
- The mining operating rate increased 0.6 percentage point to 92.4 percent, 6 percentage points under its long-term average. The operating rate for utilities grew 3.5 percentage points to 72.3 percent, well under its long-term average.