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Economy in Brief

U.S. Industrial Production Increases; Factory Output Strengthens
by Tom Moeller  May 16, 2017

Industrial production increased 1.0% (2.1% y/y) during April following a 0.4% March gain, revised from 0.5%. A 0.4% increase had been expected in the Action Economics Forecast Survey. Manufacturing sector output also rose 1.0% (1.7% y/y) after an unrevised 0.4% decline. Utilities output increased 0.7% (-0.5% y/y). Mining output improved 1.2% (7.3% y/y), the third month of strong increase this year.

Production of final products strengthened 1.5% (1.8% y/y), the strongest increase since November 2014. Durable consumer goods production increased 3.0% (3.4% y/y) after a 2.2% fall as motor vehicle output jumped 5.1% (4.7% y/y) following a 3.7% decline. Appliance, furniture & carpeting production increased 1.8% (1.0% y/y) after two months of sharp decline. Computer, video & audio equipment production declined 1.3% (+2.2% y/y), the third month of substantial decline this year. Nondurable consumer goods production gained 1.1% (0.8% y/y) after a 2.5% jump. The increase reflected a 1.5% surge (2.7% y/y) in food & tobacco production. Paper product output increased 0.7% (-3.1% y/y) while chemical production rose 0.6% (-1.5% y/y). Clothing output eased 0.3% (-5.2% y/y), down for the sixth straight month.

Business equipment production surged 1.2% (1.3% y/y) after three months of little change. Transit equipment production jumped 2.0% (-2.0% y/y) and made up the prior month's decline. Information processing equipment production increased 0.7% (5.5% y/y) following a 1.5% strengthening.

Materials production increased 0.8% (2.8% y/y) prompted by a 1.6% recovery (0.6% y/y) in textile product output, following sharp declines in three of the prior four months. Production of energy materials jumped 1.2% (4.3% y/y) about as it did in the prior two months. Durable consumer parts production increased 2.1% (3.6% y/y). Nondurable goods materials gained 0.5% (1.7% y/y) after two months of decline.

Amongst the special aggregate series, high-technology product production eased 0.1% (+5.9% y/y), off for the third month in the last four. Factory output excluding high technology products increased 1.0% (1.6% y/y). Factory output excluding both high-tech and motor vehicles improved 0.7% (1.4% y/y) following a 0.2% dip.

Capacity utilization increased to 76.7%, its highest point since August 2015. Factory sector utilization surged 75.9%, the highest level since December 2014. Factory sector capacity rose a steady 0.7% y/y.

Industrial production and capacity data are included in Haver's USECON database, with additional detail in the IP database. The expectations figure is in the AS1REPNA database.

Industrial Production (SA, % Change) Apr Mar Feb Apr Y/Y 2016 2015 2014
Total Output 1.0 0.4 0.2 2.1 -1.2 -0.7 3.1
Manufacturing 1.0 -0.4 0.3 1.7 -0.0 0.1 1.2
    Consumer Goods 1.5 1.4 -1.1 1.3 0.6 2.3 0.8
    Business Equipment 1.2 -0.3 0.0 1.3 -1.8 -0.9 1.9
    Construction Supplies -0.1 -1.2 1.7 2.2 1.3 0.5 3.4
  Materials 0.8 0.0 0.8 2.8 -2.3 -1.4 5.1
Utilities 0.7 8.2 -5.2 -0.5 -0.3 -0.7 1.4
Mining 1.2 -0.4 3.8 7.3 -9.1 -4.3 10.7
Capacity Utilization (%) 76.7 76.1 75.8 75.6 75.7 76.8 78.6
 Manufacturing 75.9 75.2 75.6 75.1 75.1 75.5 75.4
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