Another day, another pair of freaking economic indicators sending out mixed signals on the state of US manufacturing.
Industrial capacity utilization and industrial production in the US both climbed slightly in August, reports the Fed, though the production numbers are less impressive than they appear because of a downward revision to July’s numbers.
Capacity utilisation has been climbing since June of last year, though it remains quite low at 74.7 per cent. To give this a bit of historical perspective, here is a chart from Calculated Risk:
Still, an improvement.
Meanwhile, a new regional survey of manufacturing activity, this one from New York Fed, reveals continued stagnation in the sector. As we’ve said before, there are conflicting signals coming from the ISM numbers — which beat expectations handily last month — and from these surveys.
The NY Fed’s general business conditions index fell three points to 4.1 — meaning activity was basically stable with modest increases in new orders and shipments. But this part was certainly worrying:
The degree of optimism about the six-month outlook continued to deteriorate, with the future general business conditions index hitting its lowest level since early 2009.
And this chart from EconomPic Data, breaking down the various components of the Fed survey, shows how things have worsened since earlier in 2010:
So which is right about the state of US manufacturing — the Fed surveys, or the ISM? Hey, you tell us. In the meantime, expect one or the other to reverse trend at some point soon.
Related links:
Empire State Manufacturing Survey – NY Fed
Industrial production and capacity utilization – Fed statistical release
Not another freaking economic indicator – FT Alphaville
Breaking down the ISM numbers – FT Alphaville