Industrial Output Remains Under Pressure Despite September Rebound

Source: Economics Group of Wells Fargo Bank, N.A. Summary The U.S. industrial sector continues to wobble amid the unfavorable mix of restrictive conditions and heightened economic and geopolitical uncertainty. The 0.3% gain in industrial production in September continues a recent seesaw trend in monthly manufacturing activity. Manufacturing Activity Floundering The U.S. industrial sector continues to flounder; that’s our takeaway despite the upward surprise to industrial production (IP) in September. Overall IP rose 0.3%, led higher by manufacturing activity, where output rose 0.4% (chart). Elsewhere, utilities production slipped 0.3% in September after some sizable gains in recent months, while mining output rose 0.4%. Manufacturing is the largest component of the industrial space, comprising roughly three quarters of output. Even as manufacturing output rose at a decent clip last month, it came after some downward revisions to previous months’ data. Looking at the overall index in the nearby chart shows that manufacturing activity has merely flat-lined since late last year. Getting into the details suggests a fairly mixed bag for manufacturing amid volatile monthly movements. For example, auto output rose 0.3%, but that came after a 4.1% plunge a month prior. Machinery output slipped 0.1% after a 1.2% gain in August. Two directional standouts are computer manufacturing and aerospace output. The former slipped 0.3%, but had risen the eight previous months, while aerospace production is 7.4% ahead of where it was six months ago. READ FULL ARTICLE >>