Industrial production flat in January

Industrial production fell 0.3% in January and was flat compared to the same month in 2016, according to a statistical release from the Federal Reserve. Also in January, manufacturing output rose 0.2% and was up 0.3% from the same month in 2016. Mining output increased 2.8%, but was only up 0.4% from January 2016. The utilities index declined 5.7% “largely because unseasonably warm weather reduced the demand for heating.”

Capacity use in the industrial sector fell 0.3 percentage points to 75.3% in January, but it rose 0.5% from the same month in 2016. Through 2017, total capacity use in the sector is expected to rise 1.3% after increasing 0.4% in 2016. Manufacturing capacity should rise 1.1% after increasing 0.7% in 2016. Mining sector capacity is expected to rise 0.9% after declining 3.4% in 2016, and capacity for electric and natural gas utilities is projected to increase 0.8%, which is flat compared to the past three years.

Most non-energy sectors had increases, but the decline in utilities “contributed substantially to losses in the overall indexes for consumer goods, business supplies and materials through their energy components.” Consumer goods declined 0.8% because of “a drop in consumer energy products and a decline in consumer durables. The drop in consumer durables “resulted primarily from a loss of 2.8% for its largest major category, automotive products.” Consumer non-energy nondurables increased 0.3% “by virtue of an increase in the foods and tobacco product group. The output of business equipment edged up, as gains in information processing equipment and in industrial and other equipment offset a decline in transit equipment.”

Construction supplies output increased 0.9%, and non-energy business supplies rose 0.3%. Production of non-energy materials edged up 0.5%, “with improvement in both durable and nondurable materials,” the release shows.