June 2021 Headline Industrial Production Improves

The headlines say seasonally adjusted Industrial Production (IP) improved month-over-month - and remains in expansion year-over-year due to comparison to the recession period one year ago. Our analysis shows the three-month rolling average improved.

Analyst Opinion of Industrial Production

The best way to view this is the 3-month rolling averages which improved. Note that:

Industrial production increased 0.4 percent in June after moving up 0.7 percent in May. In June, manufacturing output edged down 0.1 percent, as an ongoing shortage of semiconductors contributed to a decrease of 6.6 percent in the production of motor vehicles and parts. Excluding motor vehicles and parts, factory output increased 0.4 percent. The output of utilities advanced 2.7 percent, reflecting heightened demand for air conditioning, as much of the country experienced a heat wave in June. The index for mining increased 1.4 percent. For the second quarter as a whole, total industrial production rose at an annual rate of 5.5 percent. Manufacturing output increased at an annual rate of 3.7 percent despite a drop of 22.5 percent for motor vehicles and parts.

Note that manufacturing is now in expansion year-over-year due to the comparison to the pandemic lockdown period one year ago.

Consider this report about the same as last month.

The rate of year-over-year growth for manufacturing employment and manufacturing production reasonably correlates.

  • The headline seasonally adjusted Industrial Production (IP) was up 0.4 % month-over-month and up 9.8 % year-over-year (YoY was published as+16.3 % last month).
  • Econintersect's analysis using the unadjusted data is that IP growth showed a deceleration in the rate of growth of 6.6 % month-over-month, and is up 9.7 % year-over-year.
  • The unadjusted 3-month rolling average year-over-year rate of growth accelerated 2.7 % from last month and is up 14.9 % year-over-year.
  • The market was expecting (from Econoday):

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