Good news for industrial production. It saw the biggest monthly gain in six months thanks to a jump in car output. Industrial production rose 0.4% in August. The increase was in-line with expectations.
Looking at the specifics – manufacturing output increased 0.7% and mining output jumped 0.3%. Utilities output declined 1.5%.
A good chunk of the 0.4% increase can be attributed to motor vehicles and parts production. After falling 4.5% in July, car output posted a 5.2% increase in August. Compared to a year ago, it looks even better. Motor vehicles and parts production are up 8.4% compared to last August.
Americans are continuing their car buying spree. Many skipped out on buying a new car during the height of the financial crisis, but now they have to upgrade. An improving housing market has also helped increase truck sales.
A report from Autodata confirmed the rise in production. According to them, light vehicle sales in August were the strongest in more than five years.
Today’s report conflicted a bit with the New York Fed’s report on manufacturing. A lot of the slowing in that index was attributed to the labor market though.
Stocks are still deep in the green in early trading after Larry Summers announced he was withdrawing his name for consideration for Fed Chief. The three major stock indexes are up between 0.5 – 1%.