Industrial production and capacity utilization measures the economic health about the total amount of production by industry grouping, most broadly for mining, manufacturing and utilities. The report contains data for previous month, for example data of March is released in month of April. The report of industrial production and capacity utilization is based on employment record that detail the total hour of work done by industrial sector employees. The report also measures the percentage ratio of actual production to potential production.
Many economists and traders considered industrial production and capacity utilization as leading indicator for economy health and financial market. It has great impact on future performance of financial market and act as trigger to increase buying and selling pressure in certain sectors.
The data of industrial production and capacity utilization is released on monthly basis by Board of Governors of the Federal Reserve System. The reading higher than expected taken as positive/bullish for USD traders while reading lower than expected taken as negative/bearish for USD.