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Industrial production dropped 2.8%,
Capacity Utilization fell to 76.4% in September
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Industrial production dropped 2.8 percent in September, as hurricanes Gustav and Ike and a strike at a major producer of civilian aircraft severely curtailed output. For the third quarter as a whole, industrial production decreased at an annual rate of 6.0 percent. Manufacturing production fell 2.6 percent in September. The output of mines plunged 7.8 percent, as crude oil and natural gas operations in the Gulf of Mexico were suspended because of the hurricanes. The output of utilities rose 2.2 percent, as temperatures returned to more normal levels in September after a relatively cool August.
The estimated effect of the disruptions from the hurricanes on total industrial production in September is about 2-1/4 percentage points. In addition to reductions in oil and gas extraction, hurricane-related shutdowns of petroleum refineries and petrochemical producers factored significantly in the decline; other manufacturing industries with storm outages made smaller contributions to the drop in output. The strike in the commercial aircraft industry contributed an estimated 1/2 percentage point to the overall decrease in industrial production.
At 107.3 percent of its 2002 average, total industrial production in September was 4.5 percent below its level of a year earlier. The capacity utilization rate for total industry fell to 76.4 percent in September, a level 4.6 percentage points below its average level from 1972 to 2007.
Posted: October 16, 2008 Thursday 08:35 AM