For August 2015, industrial production dipped 0.4% after increasing 0.9% in July. Manufacturing output declined 0.5% largely due to a slowdown in the automotive sector. The mining index decreased 0.6%, whereas utilities output climbed 0.6%. Total industrial production in August 2015 was 0.9% above levels in the same month a year prior, while industrial capacity utilization slid 0.4 ppts to 77.6%, which is 2.5 ppts below its 1972 to 2014 average.
The Purchasing Managers' Index (PMI) decreased 1.6% in August to 51.1%, with a value above 50 signifying expansion in the manufacturing industry. August’s PMI reflects growth in 10 of 18 manufacturing industries including machinery, fabricated metal products, chemical products and miscellaneous manufacturing. Fabricated metal products are benefiting from commercial construction, whereas the automotive industry is providing ample demand for machine shops. In addition, low-cost raw materials are positively impacting miscellaneous manufacturing.
Following July’s sharp downturn to 91.0, the Consumer Confidence Index rebounded to 101.5 in August 2015. A positive outlook on the labor market has brightened consumers’ attitudes regarding current economic conditions. Despite income expectations remaining mostly unchanged, the near-term market sentiment is optimistic. The number of those expecting fewer jobs has decreased sharply whereas more people are anticipating increased job prospects. The amount of consumers expecting business conditions to worsen has dropped, while a greater proportion of participants is projecting improved conditions.
New orders for manufactured durable goods in July 2015 gained 2.2% or $5.1 billion to $241.7 billion, which marks two consecutive monthly increases. Transportation equipment drove results, climbing 5.5% or $4.4 billion to $84.0 billion. July’s shipments of manufactured durable goods advanced 1.0% or $2.4 billion to $243.3 billion, following a 0.9% increase in June.
Per the second estimate, real Gross Domestic Product (GDP) increased at an annual rate of 3.7% in Q2 2015, versus 0.6% growth in Q1 2015. Q2 2015 expansion was attributed to gains in personal consumption expenditures, state and local government spending, exports, private inventory investment as well as residential and nonresidential fixed investment, which were partially offset by higher import volumes and declines in federal government spending.
In July 2015, the chemical and allied products PPI increased to 269.5 from June’s reading of 268.2.