US INDUSTRIAL PRODUCTION UNEXPECTEDLY CONTRACTS IN JANUARY

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January industrial production numbers are out.Industrial production contracted 0.1 per cent in January. Economists expected it to rise 0.2 per cent after expanding 0.3 per cent in December.

Manufacturing production contracted 0.4 per cent versus estimates of a flat reading.

Below is a summary from the release:

The production of consumer goods declined 0.2 per cent in January following an increase of 0.4 per cent in December. In January, the index for consumer durables decreased 2.0 per cent, but the index for consumer nondurables rose 0.4 per cent. Among durable consumer goods categories, the production of automotive products dropped 3.9 per cent and the output of home electronics fell 1.3 per cent; these losses were partly offset by an increase of 2.0 per cent for appliances, furniture, and carpeting and a small gain for miscellaneous goods. A weather-related jump of 3.1 per cent in the output of consumer energy products boosted the index for consumer nondurables; the output of non-energy goods declined 0.5 per cent, with decreases in all of its major components except clothing.

The output of business equipment edged up 0.1 per cent in January and was 6.9 per cent above its year-earlier level. The small gain in January was supported by an increase of 0.4 per cent in the industrial and other equipment category; the indexes for transit equipment and information processing equipment each fell 0.3 per cent. All three of the major components of business equipment have moved up over the past 12 months, but the advance of 16.0 per cent for transit equipment substantially exceeded the gains of around 4 per cent for the other categories.

The production of defence and space equipment increased 0.4 per cent in January following a decrease of 0.5 per cent in December; the index was up 4.2 per cent over the past 12 months.

Among nonindustrial supplies, the output of construction supplies declined 0.1 per cent in January following gains of 1.0 per cent in December and 2.5 per cent in November. In January, the output of construction supplies was 2.1 per cent above its level of a year earlier. The production of business supplies rose 0.6 per cent in January after having decreased 0.2 per cent in December. In January, the indexes for both categories of nonindustrial supplies remained well below their pre-recession peaks.

The production of materials to be processed further in the industrial sector moved down 0.2 per cent in January after having risen 0.5 per cent in December. In January, the output of durable materials slipped 0.2 per cent; the indexes for equipment parts and consumer parts both increased slightly, but the index for other durable materials fell 0.6 per cent. The production of nondurable materials declined 0.7 per cent; a gain of 1.8 per cent in the output of textiles was outweighed by losses in the indexes for paper and chemicals. The output of energy materials was unchanged.

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