Capacity Utilization Numbers Not Signaling Recession

Overall capacity utilization rose to 80.5 percent in March, from 80.3 percent in February and compared to the market expectation of 80.3 percent. According to Econoday, the report overstates strength in the industrial sector with the March gain almost entirely due to large gains in utilities and in mining.

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Still, we have yet to see the spike down in capacity utilization that has accompanied every recent recession.

Comments

[User 143167:]

It is weird to say, but if you look more closely, it more likely singals that we are in the very early phase of a recession or even haven't touched the recession which will have its trough in 2009.

2008 Apr 18 05:52 AM

[Ames Tiedeman:]

These numbers do not mean what they used to. It is not 1981.

2008 Apr 18 07:03 AM

[CrossProfit_:]

We can have a high utilization rate in the U.S. while enduring a consumer recession whereas the production is exported in an attempt to reduce the energy based trade imbalance.

Disclosure: Opinion of a CrossProfit analyst and is NOT the CrossProfit consensus.
www.crossprofit.com

2008 Apr 18 08:51 AM

[FuturePundit:]

High commodity prices combined with a declining dollar are causing a surge in industries involved in energy extraction, mining, and agriculture. The declining dollar alone is a boost to various manufacturing industries. But we will eventually get forced into an inflationary recession.

2008 Apr 19 05:50 PM