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U.S. factory production rises for 3rd straight month

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U.S. factories increased production for a third straight month in October, as stronger output of primary metals and furniture offset declines in auto production.

Manufacturing output rose 0.3 percent last month, up from 0.1 percent in September, the Federal Reserve reported Friday. Factory output is the biggest component of industrial production, which also includes mining and utilities.

Overall industrial production fell 0.1 percent after a 0.7-percent September gain. The mining sector, which includes oil and gas drilling, declined 1.6 percent after six months of gains. Utility output fell 1.1 percent.

Manufacturing has been gaining strength in recent months. Output has risen in five of the past six months. And factories have stepped up hiring over the past three months, according to the government's October employment report released last week.

Factories are busier in part because overseas growth has picked up and the slow housing recovery has driven more demand for furniture and other wood products. Automakers are also having their best year for sales since the recession, although production of motor vehicles and parts fell 1.3 percent in October after two months of gains.

Output of primary metals such as steel rose 1.1 percent and furniture production was up 1.5 percent.

Economists were encouraged by the gains in manufacturing after a period of weakness in the spring and early summer. They predicted those increases would continue, helped by strengthening overseas demand and less impact from federal government spending cuts and tax increases.

"As long as the overseas recovery continues and the domestic fiscal drag fades, output should continue to grow at reasonable rates," said Paul Dales senior U.S. economist at Capital Economics.

The government report was the latest sign of strength for manufacturing. A private sector report from the Institute for Supply Management showed factory activity climbed to a 2-1/2-year high in October. The group's manufacturing index has risen for five straight months. The October gain was especially encouraging because it showed the federal government's 16-day partial shutdown had little effect on manufacturers.

The overall economy grew at an annual rate of 2.8 percent in the July-September quarter, according to initial figures that are subject o revision. But 0.8 percentage point of that growth came from a buildup in business stockpiles. Many economists believe businesses will cut back on stockpiling in the current October-December period and that will slow growth.

Manufacturers are hoping that rising export sales will offset weakness in domestic demand.

Through the first nine months this year, exports are up a modest 1 percent. U.S. companies have had to deal with weakness in Europe, which has cut into sales in that important market.

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  1. Cramer agrees...says don't buy it and sell it if you own it! Their "pay to play" cost is this issue. As long as they charge customers, they never will attain the critical mass needed to be a successful on company...Jim Cramer quote.

  2. My responses to some of the comments would include the following: 1. Our offer which included the forgiveness of debt (this is an immediate forgiveness and is not "spread over many years")represents debt that due to a reduction of interest rates in the economy arguably represents consideration together with the cash component of our offer that exceeds the $2.1 million apparently offered by another party. 2. The previous $2.1 million cash offer that was turned down by the CRC would have netted the CRC substantially less than $2.1 million. As a result even in hindsight the CRC was wise in turning down that offer. 3. With regard to "concerned Carmelite's" discussion of the previous financing Pedcor gave up $16.5 million in City debt in addition to the conveyance of the garage (appraised at $13 million)in exchange for the $22.5 million cash and debt obligations. The local media never discussed the $16.5 million in debt that we gave up which would show that we gave $29.5 million in value for the $23.5 million. 4.Pedcor would have been much happier if Brian was still operating his Deli and only made this offer as we believe that we can redevelop the building into something that will be better for the City and City Center where both Pedcor the citizens of Carmel have a large investment. Bruce Cordingley, President, Pedcor

  3. I've been looking for news on Corner Bakery, too, but there doesn't seem to be any info out there. I prefer them over Panera and Paradise so can't wait to see where they'll be!

  4. WGN actually is two channels: 1. WGN Chicago, seen only in Chicago (and parts of Canada) - this station is one of the flagship CW affiliates. 2. WGN America - a nationwide cable channel that doesn't carry any CW programming, and doesn't have local affiliates. (In addition, as WGN is owned by Tribune, just like WTTV, WTTK, and WXIN, I can't imagine they would do anything to help WISH.) In Indianapolis, CW programming is already seen on WTTV 4 and WTTK 29, and when CBS takes over those stations' main channels, the CW will move to a sub channel, such as 4.2 or 4.3 and 29.2 or 29.3. TBS is only a cable channel these days and does not affiliate with local stations. WISH could move the MyNetwork affiliation from WNDY 23 to WISH 8, but I am beginning to think they may prefer to put together their own lineup of syndicated programming instead. While much of it would be "reruns" from broadcast or cable, that's pretty much what the MyNetwork does these days anyway. So since WISH has the choice, they may want to customize their lineup by choosing programs that they feel will garner better ratings in this market.

  5. The Pedcor debt is from the CRC paying ~$23M for the Pedcor's parking garage at City Center that is apprased at $13M. Why did we pay over the top money for a private businesses parking? What did we get out of it? Pedcor got free parking for their apartment and business tenants. Pedcor now gets another building for free that taxpayers have ~$3M tied up in. This is NOT a win win for taxpayers. It is just a win for Pedcor who contributes heavily to the Friends of Jim Brainard. The campaign reports are on the Hamilton County website. http://www2.hamiltoncounty.in.gov/publicdocs/Campaign%20Finance%20Images/defaultfiles.asp?ARG1=Campaign Finance Images&ARG2=/Brainard, Jim

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