Monday, September 16, 2013

Industrial Production and Capacity Utilization

These rates measure the physical output of the nation’s factories, mines, and utilities and reflect the usage level of available resources. Because the manufacturing
sector accounts for an estimated one-quarter of the economy, these reports
can sometimes have a big impact on stock and financial market movement.
The capacity utilization rate provides an estimate of how much factory capacity is in use. If the utilization rate gets too high (above 85 percent), it can
lead to inflationary pressures.

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