Production Grows at Slowest Rate since January 2014

The durable goods industrial production index was 110.9 in February 2015. In six of the last seven months the index has been above 110.0. The index is at all-time highs and about 10% above peak levels before the financial collapse in 2008. January was the 25th consecutive month that the index set a record high for the given month. The month-over-month rate of growth was 3.9%, which was the slowest rate of growth since January 2014. The annual rate of growth remained at 5.5%, which is the fastest rate of annual growth since May 2013. However, I think we have seen the peak rate of annual growth in industrial production for 2015.

The best leading indicators for durable goods production are housing permits, capital goods new orders, and consumer durable goods spending. Housing permits may have bottomed and are poised for accelerating growth. Capital goods new orders continue to grow at a strong rate but the most recent data has shown some softening. Durable goods spending is still growing at a relatively strong rate and above its historical average. 

We track industrial production and its leading indicators for a number of industries. Click on the links below to see how each industry is faring.

Accelerating Growth: aerospace; appliances; construction materials; custom processors; durable goods; electronics/computers/telecommunications; food/beverage; forming/fabricating (non-auto); furniture manufacturing; HVAC; industrial motors/hydraulics/mechanical components; medical; military; petrochemical processors; plastic/rubber products; power generation; textiles/clothing/leather goods; wood/paper products

Decelerating Growth: automotive; machinery/equipment; metalcutting job shops; off-road/construction machinery; oil/gas-field/mining machinery; primary metals; printing; pumps/valves/plumbing products; ship building

Accelerating Contraction: none

Decelerating Contraction: hardware