US Industrial Production Shrinks YoY For First Time Since Trump Elected
Following August’s surprise surge in industrial production, September saw a big disappointment with headline output dropping 0.4% MoM (twice as bad as the 0.2% drop expected).
And worse still, on a year-over-year basis, industrial production has shrunk for the first time since Trump’s election in Nov 2016
Additionally, US manufacturing output contracted 0.5% MoM in September (worse than the 0.3% decline expected), likely depressed by an autoworkers’ strike at GM, sluggish global demand, and the trade war.
A 4.2% decline in output of vehicles and parts was the largest since January, the Fed said. Production of primary metals, machinery and plastics also fell in September.
But as the chart above shows, the trend was already weak ahead of the GM strike.
And finally, the Dow INDUSTRIAL average remains entirely decoupled from the economy’s INDUSTRIAL output…
The data corroborate other reports showing a fragile manufacturing sector. The Federal Reserve Bank of New York’s factory gauge remained subdued in October and the Institute for Supply Management’s index dropped to the lowest level since 2016.
Thu, 10/17/2019 – 09:22