Industrial production rose 0.3% in September in the US. Analysts at Wells Fargo, point out that the solid production of business equipment bodes well for Q3 GDP, but warn industrial production is likely to moderate in the coming months.
Key Quotes:
“Industrial production remained solid in September, advancing 0.3%. The impact from Hurricane Florence was fairly minor”” less than 0.1 percentage point-the Fed estimates. Higher oil prices have continued to support mining activity, which was up 0.5% in September and 13.4% over the past year.”
“After a 0.8% gain last month, production of business equipment rose at an 8.0% clip in the third quarter. That points to another decent print for equipment spending for Q3 GDP. Nevertheless, total industrial production slowed over the quarter.”
“We expect to see further moderation in the coming months amid slower global growth, a strong dollar, ongoing trade tensions and rising rates.”
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