Industrial Production and Capacity Utilization Fall
Awhile back, I posted a graph showing the relationship between unemployment and capacity utilization. Here's an updated version:
[Note: To highlight the relationship, the graph shows 100-(UN rate) on the right-hand scale. Thus, an upward movement in the red line represents a decline in unemployment.]Though one month does not constitute a trend, today's data on capacity utilization are not very encouraging:
Industrial production decreased 0.2 percent in September after having increased 0.2 percent in August. ... The capacity utilization rate for total industry edged down to 74.7 percent, a rate 4.2 percentage points above the rate from a year earlier but 5.9 percentage points below its average from 1972 to 2009.Calculated Risk and spencer at Angry Bear have more on the report.