In July, the index for production of durable goods was 98.4, which was the lowest level since February. However, compared with one year ago, the index increased 8.1%, which was the fifth straight month of growth. The historical average month-over-month growth rate is 3.2%. The stronger than normal growth is somewhat due to an easy comparison with last year when the country was still exiting from lockdowns. The comparisons will get less easy each month.

The annual rate of change, which is easier to correlate with other data points, grew 4.6%. This was the third straight month of accelerating growth. The key leading indicator of production – durable goods new orders – grew at an accelerating annual rate for the second consecutive month. Durable goods new orders are indicating that production should see accelerating growth in the second half of 2021 and possibly into 2022. 

We track industrial production and its leading indicators for a number of industries.

Accelerating Growth: aerospace, construction materials, custom processors, durable goods, electronics/computers, food/beverage processing, hardware, HVAC, industrial motors/hydraulics/mechanical components, machinery/equipment, medical, military, off-road/construction machinery, petrochemical processors, plastic/rubber products, power generation, primary metals, ship/boat building, textiles/clothing/leather goods, wood/paper products

Decelerating Growth: appliances, automotive

Accelerating Contraction: 

Decelerating Contraction: forming/fabricating (non-auto), furniture, metalcutting job shops, oil/gas-field/mining machinery, printing, pumps/valves/plumbing products