2017 Economic Calendar
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Industrial Production  
Released On 11/16/2017 9:15:00 AM For Oct, 2017
PriorPrior RevisedConsensusConsensus RangeActual
Production - M/M change0.3 %0.4 %0.5 %0.3 % to 1.2 %0.9 %
Manufacturing - M/M0.1 %0.4 %0.3 %0.2 % to 0.9 %1.3 %
Capacity Utilization Rate - Level76.0 %76.4 %76.3 %76.1 % to 76.9 %77.0 %

The last piece has fallen into place. The manufacturing component of the industrial production has not been confirming the enormous strength of regional and private surveys nor recent acceleration in factory orders data, that is not until October's 1.3 percent surge and a 3 tenths upward revision to September which is now at 0.4 percent. Manufacturing makes up the vast bulk of the industrial production report where October's headline gain is a higher-than-expected 0.9 percent with capacity utilization up 6 tenths to 77.0 percent.

Motor vehicles are a major positive for manufacturing production, putting together a string of sharp gains including a 1.0 percent October increase. And recent gains in auto sales, in part tied to hurricane-replacement demand, point to continued strength. Selected hi-tech is another center of strength, also showing a string of gains including 1.1 percent in the latest month.

The report's mining component has been uneven in recent months, down 1.3 percent in October, but the year-on-year gain is still formidable at 6.4 percent. Utilities have also been uneven, bouncing 2.0 percent higher and helping to offset the step back for mining. Year-on-year, utility production is up a modest 0.9 percent.

The yearly gain for manufacturing is still moderate at 2.5 percent but all the indications from the factory sector are pointing to acceleration going into year end, an upward pivot that should give a special boost to fourth-quarter GDP.

Note that traditional non-NAICS numbers for industrial production may differ marginally from NAICS basis figures.

Consensus Outlook
The one key reading out of the factory sector that has yet to show strength is manufacturing production in the Federal Reserve's industrial production report. Manufacturing production inched 0.1 percent higher in September for only the second gain in five months though factory hours in the employment report point to a strong rebound for October. The report's other two components, mining and utility production, have been uneven following this season's hurricanes. Forecasters are calling for a 0.5 percent gain in industrial production for October with manufacturing production seen rising 0.3 percent. Overall capacity utilization is expected to rise 3 tenths to 76.3 percent.

The Federal Reserve's monthly index of industrial production and the related capacity indexes and capacity utilization rates cover manufacturing, mining, and electric and gas utilities. The industrial sector, together with construction, accounts for the bulk of the variation in national output over the course of the business cycle. The production index measures real output and is expressed as a percentage of real output in a base year, currently 2012. The capacity index, which is an estimate of sustainable potential output, is also expressed as a percentage of actual output in 2012. The rate of capacity utilization equals the seasonally adjusted output index expressed as a percentage of the related capacity index.

The index of industrial production is available nationally by market and industry groupings. The major groupings are comprised of final products (such as consumer goods, business equipment and construction supplies), intermediate products and materials. The industry groupings are manufacturing (further subdivided into durable and nondurable goods), mining and utilities. The capacity utilization rate -- reflecting the resource utilization of the nation's output facilities -- is available for the same market and industry groupings.

Industrial production was also revised to NAICS (North American Industry Classification System) in the early 2000s. Unlike other economic series that lost much historical data prior to 1992, the Federal Reserve Board was able to reconstruct historical data that go back more than 30 years.  Why Investors Care
The industrial sector accounts for less than 20 percent of GDP. Yet, it creates much of the cyclical variability in the economy.
Data Source: Haver Analytics
The capacity utilization rate reflects the limits to operating the nation's factories, mines and utilities. In the past, supply bottlenecks created inflationary pressures as the utilization rate hit 84 to 85 percent.
Data Source: Haver Analytics

2017 Release Schedule
Released On: 1/182/153/174/185/166/157/148/179/1510/1711/1612/15
Release For: DecJanFebMarAprMayJunJulAugSepOctNov

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