Friday, August 14, 2009

Industrial production finally bounces back

It has been a long time coming, but the monthly Federal Reserve report on Industrial Production finally showed a bounce in July. One month is certainly not enough to mark a true trend change, but other than a one-month blip in October 2008 due to recovery from a hurricane, this is the first gain in industrial production since December 2007, which marked the beginning of the recession. The July gain only erased the June loss, but that is still much better than a steady decline. Even excluding motor vehicles and parts, manufacturing production edged up 0.2%. Capacity utilization also edge up, another sign of a possible recovery.

In short, we are by no means out of the woods and have a lot of lost ground to recover, but this was definitely a very green shoot.

-- Jack Krupansky

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