U.S. Industrial Production Falls 0.7%

U.S. industrial production fell 0.7% in June, which was more than expected and the ninth straight month it has declined, according to a report released Tuesday by the Federal Reserve.

This is bad news for trucking companies because the manufacturing sector is one of their biggest and most important customer groups.

loomberg News said the drop was the largest since January, and if industrial production declines one more month, it will match the longest stretch of negative readings since 1982.

Tim McGee, chief economist at Tokai Bank, told Bloomberg there will have to be a pickup in consumer spending before production begins to recover.

The Fed's report found that industry operated at 77% of capacity in June, the lowest reading since August 1983, down from 77.6 percent in May.

Analysts had expected production drop of 0.5% and a plant-use rate of 76.9%, according to Bloomberg.

Production of consumer durable goods, which includes automobiles, home electronics, appliances and furniture, fell 1.2% after rising 1.1% in May, the report said. Production of non-durable consumer goods, which include food, clothing and beverages, was unchanged after falling 0.3%.

7556