Industrial Production measures the total output of the industrial sector of the economy, consisting of the manufacturing, mining and utilities sectors. It is measured with the monthly release of the Industrial Production Index by the Federal Reserve, which is seasonally adjusted. Higher readings of the index show growth in the industrial, and are considered to have positive effects for the US Dollar and the economy, as higher measures of Industrial Production can lead to higher economic growth in terms of GDP. Oil prices are a very important factor for the Industrial Production, along with the level of interest rates. Higher oil prices and higher interest rates increase the costs for the industrial sector, and can have a negative effect on its long-term growth.
The United States Industrial Production
The United States Industrial Production rose 0.3% in June, better than the forecast of 0.3% and it was actually the 5th consecutive month of gains, showing a strong industrial production activity. The Industrial Production Index for June was 105.2, higher than the previous reading of 104.8. The Industrial Production Index has a base value set at 100 in 2012.On a yearly basis the Industrial Production rose 2.0% in June of 2017. The long-term average for the Industrial Production for the period of years 1920-2017 is positive and stands at 3.74%. Industrial Production had an all-time high growth of 62% in July of 1993, and an all-time low growth of -33.70% in February of 1946.
