US December industrial production rose 0.3%

US December industrial production increased by 0.3% compared to November, its fifth successive monthly rise, according to the Federal Reserve (Fed) today. The index includes output for mines, utilities and manufacturers.

A survey of Dow Jones economists had accurately predicted a US December industrial production increase of 0.3%.

Industrial production grew at an annual rate of 6.8% during the last quarter of 2013, the largest quarterly increase in three-and-a-half years. The Fed added that growth was widespread across most industries.

Factory output increased by 0.4% in December after increasing by 0.6% during each of the previous two months. December factory output levels were 2.6% higher than in December 2012.

Production in US mines rose 0.8%, the index gained 6.6% over a 12-month period.

After three successive gains, utilities output dropped by 1.4% in December. Utilities output is 1.8% higher than the average for 2007

Total industrial output increased by 3.7% in 2013 compared to the previous year, and is 0.9% higher than its pre-recession peak in December 2007.

Production of consumer goods

There was a 0.5% increase in US December production of consumer goods, its fifth successive monthly increase, and was 3.6% above its December 2012 level.

Below are some highlighted data regarding the production of consumer goods:

  • The index grew by 8.8% annually in Q4 2013.
  • In December, durable goods output increased by 1.1%, mainly driven by carpeting, furniture, appliances, home electronics, and automotive products.
  • Durable goods output grew at an annual rate of 14.7% during Q4 2013.
  • Nondurable goods output increased by 0.3% in December. Increases in clothing, paper products, tobacco and foods more than offset falls for consumer energy products and chemical products.
  • In Q4 2013 the index for non-energy consumer nondurables rose by 2.7% (annualized).
  • Consumer energy products rose by more than 20% (annualized) in Q4 2013.
  • Business equipment output fell 0.5% in December, after decreasing 0.3% the month before.
  • During Q4 2013 business equipment rose at an annual rate of 3.7%.
  • Defense and space equipment remained the same in December, but rose by 7.5% in the fourth quarter compared to the same quarter the year before.
  • Industrial supplies grew by 0.4% in December, the 7th successive monthly gain, and was 4.4% higher than in December 2012.

Over the last few months much economic data coming out of the United States suggests a very positive outlook for 2014. The American Bankers Association describes 2014 as America’s breakout year. However, the Economic Policy Institute points out that America is still eight million jobs short if it wants to return to pre-crisis levels of employment.

Bloomberg Businessweek quotes Jim O’Sullivan, chief US economist at High Frequency Economy, New York, who says “Pretty clearly there’s been a pickup in manufacturing in the last couple months. Certainly you have to start with the consumer in the last couple of months and there’s been a pretty strong pace in goods consumption.”

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