Predicting Turning Points in Industrial Production Growth

Timing is everything. Knowing what to do in different market environments is crucial but knowing when to act is what sets you apart. What if you could predict economic turning points before your competitors?

Industrial Production (IP) – a key measure of manufacturing activity – holds insights into economic cycles that can reshape decision-making. Watch our short video, Predicting Turning Points in Industrial Production Growth, to see how IP cycles work and how to stay ahead of them.

IP isn’t just a snapshot of current economic activity. It’s closely tied to equity markets, industrial demand, and commodity prices.

The challenge? Anticipating when IP growth will change direction.

Many rely on popular tools, like the purchasing manager’s indexes (PMIs) for guidance. While useful, our research shows that PMIs are roughly coincident with IP growth, providing little lead time for decisive action.

At ECRI we've developed a repeatable process to anticipate turning points in IP with incredible accuracy. A key component of that process is our U.S. Leading Manufacturing Index (USLMI), which turns about five months ahead of U.S. IP growth on average. This lead time is enables decision-makers to stay ahead of market shifts, make better informed tactical choices, and seize opportunities before others.

The proof is in the pudding. By overlaying USLMI growth on U.S. IP growth, the leading relationship at both peaks and troughs becomes clear.

Monitoring the USLMI and other leading indexes in ECRI’s toolkit allows you to pinpoint your position in the cycle, anticipate turning points, and outmaneuver your competitors relying on coincident or lagging indicators.

Why does this matter? Markets reward foresight. With ECRI's insights, you’re equipped to predict shifts in IP and PMIs, ensuring you can effectively plan ahead in a changing landscape.

Watch the video to learn how to predict turning points in IP growth, improve your timing, and outperform your competition.