For Q1 2015, industrial production moved 1.0% lower which marks the first quarterly retreat since Q2 2009. Industrial production declined 0.6% in March 2015 after February’s 0.1% increase. Manufacturing output in March edged up 0.1%, while mining production and utilities output lost 0.6% and 5.9%, respectively. Total industrial production in March 2015 was 2.0% above the same month in 2014, while industrial capacity utilization slipped 0.6%, which is 1.7% below its 1972 to 2014 average.
The Purchasing Manager Index (PMI) for March retreated 1.4 ppts to 51.5%, a third monthly decline. A value above 50 signifies expansion in the manufacturing industry. Congested West Coast ports recovering from the recent dock slowdown are encumbering supply chain logistics and delaying incoming goods, while slumping oil prices continue to benefit certain industries as others seek cost reductions. March’s PMI reflects growth in 10 of 18 manufacturing industries including primary metals; fabricated metal products; transportation equipment; machinery; chemical products and computer & electronic products.
Following February’s downturn, the Consumer Confidence Index advanced in March 2015 to 101.3. Consumers’ short-term outlook enhanced as employment and income prospects led to optimism, while the perception of current economic conditions weakened. Expectations regarding the labor market were positive as more jobs and growing income are anticipated in the months to come.
New orders for manufactured durable goods in February 2015 were down 1.4% or $3.2 billion to $231.3 billion, after declining three of the past four months. New orders for transportation equipment in February drove the decrease, sliding 3.5% or $2.5 billion to $69.5 billion. February’s shipments of manufactured durable goods edged down 0.2% or $0.5 billion to $244.0 billion.
Per the third estimate, real Gross Domestic Product (GDP) increased at an annual rate of 2.2% in Q4 2014, compared to 5.0% in Q3 2014. Q4 2014 expansion was attributed to gains in personal consumption expenditures, exports, nonresidential/residential fixed investment and state and local government spending. The slowing rate of real GDP growth was due to heightened imports, declines in federal government spending, decelerated growth in nonresidential fixed investment and a reduction in private inventory investment.
In March 2015, the chemical and allied products PPI decreased to 266.0 from February’s reading of 266.5.