The Wall Street Journal may have gotten a bit carried away in telling readers that manufacturing had hit a "sweet spot" based on the Fed's data on manufacturing production in June. The immediate story was the Federal Reserve Board's report that manufacturing production had increased 0.8 percent in June following a 1.0 drop in May. The May decline was the result of a fire at a parts supplier for Ford.

While the bounce-back was encouraging, it still means that for the two-month period manufacturing output was down 0.2 percent. It seems hard to view this as positive news for the sector. Monthly data are erratic, so it is entirely possible that this decline will be offset by stronger growth in July and subsequent months, but it seems hard to view the June data as especially positive.

It is also worth noting that the longer term picture hardly suggests a boom for the sector. Here's the picture going back to 2000. Output was growing much faster in the early years of the recovery. There were also periods in 2014 and 2015 when output increased at a similar pace. The near zero growth from 2000 to 2004 was due to the explosion of the trade deficit.

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