Broad Gains Seen Throughout the Economy in July
According to a recent report by Bloomberg, U.S. factories saw their best month in July from the previous five months. Automobiles were produced at their fastest rate in 14 years, while more companies invested in equipment as a result of a stronger economy. Businesses seeking to expand should consider leasing equipment as an option instead of purchasing. Leasing provides more flexibility for capital and the ability to upgrade to newer models with ease.
“The manufacturing sector at this point appears to be firing on all cylinders and, if anything, that’s an indication that momentum in the U.S. economy is picking up,” Millan Mulraine, deputy head of U.S. research and strategy at TD Securities USA LLC in New York, told Bloomberg. “We’ve seen it in machinery and computers, and also in motor vehicle production.”
The Federal Reserve reported that industrial production rose 0.4 percent, marking the sixth consecutive month of gains. Manufacturing output was up 1 percent during the month, the largest increase since February. The rise was mostly led by a 10.1 percent jump in automobile production, while the rest of manufacturing was up 0.4 percent. The annualized rate of automobile production reached 13.2 million in July, the fastest pace since May 2000, Bloomberg reported.
While gains were broad throughout the economy, indicating growing strength, output for business equipment was good news for U.S. businesses. Transportation goods and machinery were both up, suggesting that manufacturing will continue to help the economy recover. In addition to equipment and automobiles, consumer goods outputs like appliances, furniture and home electronics also picked up during the month. However, consumer confidence dipped slightly during August, as wage perceptions dropped, despite the improving conditions around the economy.