https://www.cmegroup.com/content/dam/cmegroup/images/common/default/article-940x600.jpg
IT: Industrial Production
| Actual | Previous | |
| Month over Month | -0.6% | -0.4% |
| Year over Year | -0.6% | 3.2% |
Highlights
Industrial output contracted 0.6 percent, seasonally adjusted, in January from the previous month, while falling by the same amount from a year ago on an unadjusted basis. Using a less volatile three-month comparison, production was up 0.7 percent in the November to January period compared to the previous three months.
Leading the decline were year-on-year drops in the manufacture of coking coal and petroleum products, down 12.9 percent and the production of chemicals which contracted 7.2 percent.
Overall manufacturing production was down 2.3 percent despite a 7.1 percent year-on-year increase for transportation equipment. Burdening the sector were declines in other manufacturing, down 5.7 percent, production of wood, paper, and printing which fell 4.2 percent and a 3.9 percent drop for textiles, clothing, and accessories.
Other indicators have shown that order books continue to remain a problem which certainly not help production in the coming months. At the same time, the conflict in the middle east will lead to higher energy prices for the productive sector which will also likely dampen demand.
Definition
Industrial production measures the physical output of the nation's factories, mines and utilities. Construction is excluded. Approximately 4,100 companies provide data on more than 8,000 monthly flows of production.
Description
Investors want to keep their finger on the pulse of the economy because it usually dictates how various types of investments will perform. The stock market likes to see healthy economic growth because that translates to higher corporate profits. The bond market prefers more subdued growth that will not lead to inflationary pressures. By tracking economic data such as industrial production, investors will know what the economic backdrop is for these markets and their portfolios. Like the PPI and the orders data, construction is excluded from the data. This report has a big influence on market behavior. In any given month, one can see whether capital goods or consumer goods are growing more rapidly. Are manufacturers still producing construction supplies and other materials? This detailed report shows which sectors of the economy are growing and which are not.