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Macro Flash Report

Industrial & Manufacturing Production

Takeaway:

November’s industrial production data disappointed as we continue to wait for follow-through from the encouraging soft data, post-election/fed cutting cycle.

In November, Industrial Production fell by -0.1% month- over-month, missing the forecasted 0.3% rise and extending the -0.4% drop in October. This marks the third consecutive month of contraction, highlighting softness in activity.

  • On an annual basis, production decreased by -0.9%, the sharpest decline since January, following a -0.45% fall in October, and below the market expected 1% increase. This also marks the third consecutive month of contracting activity.

Capacity Utilization ticked down to 76.8% from 77.0% in the prior month, falling short of the anticipated increase to 77.3%. This represents the lowest reading since April 2021 and is 2.9% below its long run average.

Manufacturing (SIC) Production, which comprises 78% of total industrial production, rose by 0.2% from -0.7% in October yet below the expected 0.5% increase.

  • The main supporters of this growth was durable goods (+3.5%) and machinery (+2.1%).
  • Annually, production fell by -1%, following a -0.7% decline in the prior month, marking the fifth consecutive month of contraction and missing the anticipated 0.1% rise.
  • Capacity Utilization inched up by 1% to 76%, a rate that is 2.3% below its long run average.