US INDUSTRIAL PRODUCTION UNEXPECTEDLY CONTRACTS IN JANUARY

Industrial production contracted 0.1 percent in January. Economists expected it to rise 0.2 percent after expanding 0.3 percent in December.

Manufacturing production contracted 0.4 percent versus estimates of a flat reading.

Below is a summary from the release:

The production of consumer goods declined 0.2 percent in January following an increase of 0.4 percent in December. In January, the index for consumer durables decreased 2.0 percent, but the index for consumer nondurables rose 0.4 percent. Among durable consumer goods categories, the production of automotive products dropped 3.9 percent and the output of home electronics fell 1.3 percent; these losses were partly offset by an increase of 2.0 percent for appliances, furniture, and carpeting and a small gain for miscellaneous goods. A weather-related jump of 3.1 percent in the output of consumer energy products boosted the index for consumer nondurables; the output of non-energy goods declined 0.5 percent, with decreases in all of its major components except clothing.

The output of business equipment edged up 0.1 percent in January and was 6.9 percent above its year-earlier level. The small gain in January was supported by an increase of 0.4 percent in the industrial and other equipment category; the indexes for transit equipment and information processing equipment each fell 0.3 percent. All three of the major components of business equipment have moved up over the past 12 months, but the advance of 16.0 percent for transit equipment substantially exceeded the gains of around 4 percent for the other categories.

The production of defense and space equipment increased 0.4 percent in January following a decrease of 0.5 percent in December; the index was up 4.2 percent over the past 12 months.

Among nonindustrial supplies, the output of construction supplies declined 0.1 percent in January following gains of 1.0 percent in December and 2.5 percent in November. In January, the output of construction supplies was 2.1 percent above its level of a year earlier. The production of business supplies rose 0.6 percent in January after having decreased 0.2 percent in December. In January, the indexes for both categories of nonindustrial supplies remained well below their pre-recession peaks.

The production of materials to be processed further in the industrial sector moved down 0.2 percent in January after having risen 0.5 percent in December. In January, the output of durable materials slipped 0.2 percent; the indexes for equipment parts and consumer parts both increased slightly, but the index for other durable materials fell 0.6 percent. The production of nondurable materials declined 0.7 percent; a gain of 1.8 percent in the output of textiles was outweighed by losses in the indexes for paper and chemicals. The output of energy materials was unchanged.

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