As the hum at US factories, mines and utilities gains in volume after a multi-year slump, policy-makers are watching for signs of overheating as they gauge when to stop raising interest rates.
Capacity utilisation - a measure of how close to flat-out a factory or mine is running - has only lately returned to historical averages after a bleak stretch of years that began when orders dried up in the 2001 recession.
An overhang of investments made just before the downturn in items such as computers and communications equipment, coupled with business caution through a slow recovery, kept capacity utilisation below par until last year, economists say.
As activity at US companies picks up, employers are likely to need to hire more workers and pay more overtime, which could translate into the Fed's nemesis: inflation.
"Tight resource utilisation is likely to put pressure on prices," Federal Reserve Governor Susan Bies said.
Capacity use in December rose to 80.7 per cent, a level last matched in November 2000, according to a Fed report released last week. The 1974-2004 average is 81 per cent.
For the full year, capacity utilisation reached 80 per cent, the strongest showing since 81.8 per cent in 2000.
"The rise in capacity utilisation is basically indicative of the manufacturing sector getting back on its feet," said National Association of Manufacturers Chief Economist David Huether.
As capacity use tightens, policy-makers will watch for any sign that producers are stretching to keep pace with demand.
"Wages are 70 per cent of the cost of production. That puts pressure on the cost structure of business, and the propensity is to increase consumer prices," said Eugenio Aleman, an economist for Wells Fargo.
What worries policy-makers is that some segments of industry are operating at rates above their long-term averages.
Ms Bies cited plastics and rubber products, iron and steel products, machinery, electronic products excluding computers, and electrical equipment as among factory segments running hot.
And while the overall high-tech capacity use average lags the long-term trend, companies making computer peripherals are using capacity above average, and communications equipment makers have ramped up capacity use rates significantly, Ms Bies noted.
For now, any price pressures that might be expected from factories, mines and utilities running closer to capacity has been absorbed by gains in how productive workers are, Ms Bies said. Even so, the Fed is vigilant for any signs of inflation, she said.
In the meantime, busier industrial production and tighter capacity is showing itself in higher commodity prices as copper and zinc hit record highs and aluminum reached a 17-year peak on metals markets late last week.. Those gains reflect industrial recovery not just in the United States but around the world, economists said.
"It's not a coincidence that commodities prices are increasing simultaneously with capacity utilization," said Gina Martin, an economist at Wachovia.
The Fed will keep a close eye for any price rises in finished goods, as reported in producer prices or consumer prices, economists said.
At the same time, one immediate outcome of current high rates of capacity utilisation may be to push firms into adding plants and equipment after a period of caution.
"As capacity utilisation edges up in the domestic economy, we're likely to see increased pressures on companies to use the mountain of cash that they're sitting on to make capital investment," said Nariman Behravesh, chief economist for Global Insight.
Growth from capital spending would boost supply and therefore put downward pressure on prices, Mr Behravesh said.
US companies are well placed to invest in boosting capacity with high levels of corporate cash on hand, strong earnings and relatively little debt.
"With capital use returning to a more normal level, you see all the stars starting to be aligned for an expansion of investment," said Don Norman, an economist for the Manufacturers Alliance/ MAPI.