Capacity Utilization Hits Highs Not Seen Since 2008

Production in July rose by 0.4%, slightly exceeding the 0.3% gain expected by Bloomberg. The June production report was revised higher to 0.4% from 0.2% initially.

Capacity utilization came in at 79.2% in July. This met the Bloomberg economists consensus expectation, and was up by 0.1% from June.

What really stands out here is manufacturing activity. This index component rose by a full 1.0% in July, after rising 0.3% in June. Also worth noting is that durable goods production rose by 1.7% in July, and up more than 8% from July of 2013 — with gains in almost all sub-indexes.

Another observation is that while the capacity utilization rate of 79.2% may have only been up by one-tenth of a percent in July, it was a post-recovery high dating back to June of 2008, when capacity was starting to fall off a cliff.