Weak Industrial Production, CPI

123jump.com Staff
15 Apr, 2009
New York City

U.S. stocks edged higher in the morning trading after the latest read on industrial production and consumer price index showed decline. The decline in both indexes was viewed by the market as deferring inflation. Capacity utilization fell to the lowest since data collection began in 1967.

[R]11:45AM New York – Industrial production declined in March matching the similar decrease in February. The consumer price index fell in march after rising in February.[/R]

U.S. stocks edged higher in the morning trading after the latest read on industrial production and consumer price index showed decline. The decline in both indexes was viewed by the market as deferring inflation.

Industrial Production Falls

Industrial production in March dropped 1.5% after a similar decrease in February. For the quarter the total output decreased 20%, the largest quarterly decrease of the current quarter.

The industrial production is summation of changes in production in manufacturing sector, mines and utilities.

The manufacturing declined by 1.7% in March, output of mines fell 3.2% and oil and gas drilling continued to fall and utilities output increased 1.8%.

For the quarter manufacturing declined 22.5% after falling 18% in the fourth quarter. Capacity utilization rate for total industry that includes all three segments fell to historic low of 69.3 since the data collection began in 1967.

Capacity utilization rates in the month grouped by stages of production at crude, semi finished and finished stages were below the long term averages.

Consumer Price Index Falls

The consumer price index in March decreased 0.1% after rising 0.4% in February after adjusting for seasonal variations. Index for all items excluding volatile food and energy prices increased at 0.2% for the third month in a row.

For the first quarter consumer prices increased at 0.1% annual rate after adjusting for seasonal variations compared to 0.1% increase in for all of 2008. Excluding food and energy the prices increased at 2.2% annual rate in the first quarter as prices of tobacco, new vehicles, medical care and apparel contributed to the rise.