1.7% Industrial Production Gain: Highest in 2 Years

The Federal Reserve reported today that Industrial Production increased in February by 1.7% compared to the same month last year, the largest increase since the 2.2% gain in January 2008. The February gain followed a year-to-year increase in industrial production 0f 0.90% in January, marking the first time of two consecutive monthly gains since January-February of 2008, and reversing 21 months of negative annual growth from March 2003 to December 2009.

Other highlights:

1. On a monthly basis, industrial production edged up 0.1% in February compared to January, following a gain of 0.9% in January. Production was likely held down somewhat in February by winter storms in the Northeast.

2. The production of consumer goods fell 0.4% in February. The index for consumer durables fell 2.3%, while the index for consumer nondurables edged up 0.1%. The decline in consumer durables was led by a drop of 4.4% in automotive products; other major components registered small declines. Despite the decrease in February, the output of consumer durables was up 9.2% from its year-earlier level as a result of an increase of 27% in automotive products; the indexes for the other major components of consumer durables were below their year-earlier levels.

See related CD post from January highlighting the expected 69% increase in motor vehicle production in the first quarter of this year.