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Industrial Production Up +0.8%

September 16th, 2009 Michael McDonough

Industrial production grew by +0.8% in August, compared to a consensus forecast of +0.7%, and a previous reading of +0.5%.  Much of this growth is attributable to increased manufacturing stemming from the US government’s Cash for Clunkers program.  The capacity utilization rate rose to 69.6 from a revised 69.0 in July.  The increment in IP came despite a decrease in hours worked for the manufacturing sector during the month.  But, going forward, without the bump from the Cash for Clunkers, the IP number could face some downward pressure.  There determinant to just how much pressure will depend on the level of inventory restocking by US companies.

IP Data:

SECTOR Mar-09 Apr-09 May-09 Jun-09 Jul-09 Aug-09
IP: Total index -1.6% -0.6% -1.1% -0.4% 1.0% 0.8%
IP: Manufacturing -1.7% -0.5% -0.9% -0.3% 1.4% 0.6%
IP: Mining -2.6% -2.7% -1.1% -0.9% 0.6% 0.5%
IP: Electric and gas util. -0.3% 0.3% -2.0% -0.5% -1.6% 1.9%
UTL: Total index -1.5% -0.5% -1.0% -0.3% 1.1% 0.9%
UTL: Manufacturing -1.6% -0.4% -0.8% -0.2% 1.5% 0.8%
UTL: Mining -2.6% -2.6% -1.1% -0.8% 0.7% 0.7%
UTL: Electric and gas util. -0.4% 0.1% -2.1% -0.7% -1.7% 1.8%

In other news, according to the Treasury International Capital Data, net foreign purchases of US assets in July totaled US$15.3bn.

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