EmailIndustrial production increased 0.9% in July after rising an upwardly revised 0.4% (from 0.2%) in June. That was the strongest increase since December 2010. The Briefing.com consensus expected industrial production growth of 0.4%.
The growth in industrial production was widespread. Extreme heat boosted demand for air conditioning, driving utilities production up 2.8% in July after increasing 0.8% in June. Mining production increased 1.1% in July after increasing 1.2% in June.
Even though the July regional Fed manufacturing surveys and the national ISM Manufacturing Report showed a weakening sector, manufacturing production increased a robust 0.6%.
A return to motor vehicle and parts production following the slowdown after the Japanese earthquake and tsunami provided a substantial boost to manufacturing growth. Motor vehicle production increased 8.0% as total motor vehicle assemblies increased from 7.89 million SAAR in June to 8.73 mln SAAR in July. This was the most vehicles assembled since March. Auto assemblies increased slightly from 2.81 mln SAAR in June to 2.82 mln SAAR in July. Light truck assemblies increased from 4.81 mln SAAR in June to 5.68 mln SAAR in July.
Even without the motor vehicle sector, manufacturing growth in July was widespread as production increased a solid 0.4%, up from 0.1% in June. There was no one outperforming sector, besides motor vehicles, that was essential in driving manufacturing production in July.
Total capacity utilization increased from an upwardly revised 76.9% (from 76.7%) in June to 77.5% in July. That is the highest level of capacity utilization since August 2008 and easily surpassed consensus expectations of 77.0% utilization.
Manufacturing utilization increased from 74.6% to 75.0%.
