THE TAKEAWAY:USD Industrial Production (MAY) > 0.0% versus +0.2% expected, from -0.4% (revised higher from +-0.5% (m/m) > USD Manufacturing Production (MAY) > +0.1% as expected, from -0.4% (m/m) >Indications of modest US economic growth > USDJPY NEUTRAL
Industrial production in the United States remained unchanged for the month of May at 0.0% from the previous mark of -0.4%. This figure proves to fall short of Bloomberg median forecasts of a +0.2% advance suggesting GDP will remain relatively unchanged in the +2.0% to +2.5% annualized range. Although accounting for only a small portion of GDP, industrial production serves as a poignant indication of volatility measures associated with deriving GDP, as it remains highly sensitive to interest rates and consumer demand.
This most recent figure can be most directly associated with recent declining use of utilities which consequently offset gains in manufacturing and mining; major economic contributors to US growth. May’s output at factories, mines and utilities experienced a -0.4% decrease in April followed by 0.1% increase in May, meeting Bloomberg median estimates. Although small, this recent manufacturing increase suggests moderate GDP growth and a slowly advancing US economy.
USDJPY 1-Minute Chart: June 14, 2013
Following the release, the USDJPY traded from ¥95.07 to as high as 95.25, before falling back to its opening level ahead of the U. of Michigan Confidence (JUN P) report at 09:55 EDT/13:55 GMT.
--- Written by Jonathan DePaolis, DailyFX Research
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