Industrial production had a huge rebound in November.
Industrial production rose 1.3% in November according to the latest report from the Federal Reserve.
Expectations were for the report to show industrial production rose by 0.7% in November, better than October’s 0.1% contraction. October’s number was revised up to 0.1% from -0.1%.
Capacity utilization also rose sharply, to 80.1% from a revised reading of 79.3%. Capacity utilization was expected to rise, to 79.4% from 78.9%.
This rate of capacity utilization is now equal to its long-run average spanning 1972-2013 and hit its highest level since March 2008.
Industrial production in all major market groups advanced in November, headlined by a 2.5% increase in production of consumer goods, the largest increase since August 1998.
This report comes after a disappointing New York state manufacturing report showed activity in the northeast unexpectedly contracted.
In a note to clients following the report, Paul Dales at Capital Economics wrote that the report, “shows that the strengthening in domestic demand is offsetting the effects of the weakening global backdrop and the stronger dollar … Looking ahead, the survey evidence has been very mixed. But we suspect that stronger domestic demand will ensure that manufacturing output continues to grow by around 5% a year.”