June was the ninth month in succession in which industrial output fell, the longest decline for almost twenty years, according to data released yesterday by the Federal Reserve.
Following a 0.5% fall in May, production dropped 0.7% last month. Output has now declined without interruption since October, the longest downturn since March–December 1982. Moreover, June’s industrial production was 23% below potential, the highest proportion of idle capacity since August 1983.
The decline was not limited to a few sectors, affecting companies in a wide range of industries. Particularly high drops in output were registered in the computer chips, trucks, consumer electronics, telecoms equipment, furniture and appliances sectors.
Despite recent hopes that the slowdown is coming to an end, the strength of the dollar and continuing falls in corporate profits mean the industrial outlook is far from certain.
News source: Financial Times