The Post article on the Fed’s monthly industrial production report told readers that “February’s numbers gave economists other signs that manufacturing would continue to recover this spring, as the capacity utilization — portion of plants used for production — climbed to 72.7 percent from 72.5 percent.”
Umm no, that’s not quite right. Overall industrial production did rise, but that was due to increases in mining and utility output. Manufacturing output actually fell by 0.1 percent in February from a level that was revised down by 0.1 percent from its previously reported level. Capacity utilization in manufacturing fell from 69.1 percent in January (previously reported as 69.2 percent) to 69.0 percent. This decline was undoubtedly in part attributable to bad weather, but the Fed’s data certainly is not pointing towards an uptick in manufacturing.
–Dean Baker
