Overall industrial production declined 0.1% on the month, surprising analysts who on average had forecast a 0.3% increase.
Compared with a year ago, the industrial production was up 4.1% in August
Manufacturing output fell 0.4% in August. It was the first time since January that total output and manufacturing output fell.
Production of cars and trucks and parts dropped 7.6% after surging more than9% in July. Stripping out automobile production, manufacturing rose 0.1% in both July and August.
“The August decline in manufacturing production should not be a cause for concern—the correction was predictable and centered on motor vehicle production,” noted Daniel J. Meckstroth, chief economist for the MAPI Foundation, the research affiliate of the Manufacturers Alliance for Productivity and Innovation. Meckstroth added. “Motor vehicles assemblies increased 12.9% in July with an inventory rebuilding surge and then declined 11.7% in August to get back to a more sustainable production rate. The swing in motor vehicle production reverberated throughout the supply chain. The August decline in manufacturing production, consequently, was not widespread.
“Manufacturing is fundamentally strong and will grow faster than the overall economy this year and next,” he concluded. “Manufacturing production increased at a 6.9% annual rate in the second quarter of 2014 and is on track to increase at a 4% annual rate in the third quarter. Pent-up demand for consumer durables, the housing supply chain, energy infrastructure, transportation equipment infrastructure, and factory equipment are all growth themes in manufacturing.”
Mining production rebounded, increasing 0.5% from a 0.3% drop.
Utilities output rose for the first time in three months, by 1%.
Capacity use dipped to 78.8% from 79.1% in July.
Copyright Agence France-Presse, 2014, IW Staff
