Industrial Production Up 4.1% in December

Consumer durable goods industrial production in December was up 4.1 percent compared to December 2009. The one-month rate of change still is still in a slowing growth mode, but it may be starting to flatten out some. Therefore, the 12-month rate of change curve looks like it is starting to peak, as can be seen in the chart.

If you look at the historical pattern, July is typically the worst month for industrial production by quite a bit. However, in 2007 December’s industrial production was almost identical to July. It’s hard to draw conclusions off of just one data point, but I think this is another indicator that the metalworking industry will start slowing (not necessarily contracting) down soon. Even if January's industrial production improves more than it has in recent months, it is likely that the 12-month rate of change curve will tip over and start growing more slowly.

Once again, while consumer durable goods production seems to be slowing, capital goods production is seeing fairly constant growth. Almost all of the major industries I track are growing faster each month, which means manufacturing is still quite strong.