Friday, December 14, 2007

Industrial Output Growth Signals Strong Economy

According to the Federal Reserve's report today, total industrial production in November 2007 was 2.1% above its level in November of last year (see chart above). This was also the highest output growth since the first quarter of 2007 (March), and marks the 51st consecutive increase in year-to-year growth in Industrial Production (June 2003 was the last month of negative growth).

On a quarterly basis, industrial output in the fourth quarter is matching growth in the second and third quarters, when GDP growth was 3.8% and 4.9%. The current estimates of real GDP growth in the fourth quarter of 1.5% might turn out to be too low, given the continuing strength in manufacturing output.

Bottom Line: Given the continued robust growth in both real output and retail sales into the fourth quarter, the economy appears to remain on solid ground, and the economic expansion is on track to continue well into 2008.

3 Comments:

At 12/14/2007 2:23 PM, Anonymous holymoly said...

I noticed you left out the downward revision for October (from -.5% to -.7%). [Minus .2%]

Economists were expecting 0.1% in November, they got 0.3% instead. [Plus .2%]

So, I see the pieces of news netting out -- especially since the November figure was calculated against the revised lower October figure.

I'm not the only one -- Stefan Karlsson notes that production in November was actually .1% lower than the initial October figure (113.9 vs. 114.0).

Odd that you'd only report one side of this news.

 
At 12/14/2007 4:23 PM, Blogger juandos said...

Wait awhile holymoly and the people you quote will have new figures out refuting their old figures...

Its been happening for the last six plus years...

 
At 12/14/2007 4:53 PM, Anonymous holymoly said...

True enough, juandos. True enough.

 

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