Industrial Production Higher on Utility Demand, Manufacturing Demand Unchanged

Industrial production rose a modest +.1% MoM in January due entirely to higher utility output (+2.2% MoM) tied to colder weather. The headline growth was right at consensus expectations. Manufacturing, which accounts for 80% of industrial production, was unchanged versus a gain of +0.2% in December. Capacity utilization, which measures how fully productive resources are utilized, was unchanged at 81.5%, after being revised higher for December. The market had been looking for capacity utilization to ease down to 81.3%. Capacity utilization remains near its long-term average. By category, mining output fell -1.8% MoM, construction supplies fell -1.1% MoM, and auto production declined -1.3% MoM. January vehicle sales were the slowest in over two years. Textiles also declined by -2.7% MoM. Production of consumer goods rose +0.3% MoM, and business equipment slowed to +0.4% MoM, from a gain of +.9% in December. Computers and electronics increased by 1.7% MoM. Industrial production, in both November and December, was revised up by +.1% MoM. Over the past year, industrial production is up +2.3% YoY, with utilities +6.2% YoY. Ex-autos, industrial production has still been up +2.3% YoY.