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Economy in Brief

U.S. Industrial Production Increases, but Factory Output Falls
by Tom Moeller  April 18, 2017

Industrial production strengthened 0.5% during March (1.6% y/y) following a 0.1% February uptick, revised from no change. A 0.4% increase had been expected in the Action Economics Forecast Survey. Earlier figures reflect benchmark revisions. Manufacturing sector output declined 0.4% (+0.8% y/y) and reversed February's 0.3% increase. Utilities output surged 8.6% (4.6% y/y). Mining output improved 0.1% (3.0% y/y) following strong gains during the prior two months.

Production of final products rose 0.8% (1.3% y/y) after two months of decline. Output of construction supplies declined 0.8% (+2.3% y/y) following two months of 1.4% increase. Business equipment also fell 0.4% (+0.7% y/y) following little change during the prior two months. A 1.2% increase (1.3% y/y) in consumer goods production offset this weakness. Nondurable, nonenergy consumer goods production rose 0.2% (-0.7% y/y) driven by a 1.2% rise (-3.0% y/y) in chemical output. Clothing production fell, however, by 1.6% (-6.5% y/y). Durable consumer goods output declined 1.7% (+2.1% y/y), as auto production fell 2.5%(+2.9% y/y). Output of computers, audio and video product production gained 0.5% (1.6% y/y) after falling for two months.

Materials production increased 0.4% (1.6% y/y), held back by a 1.0% decline (-0.5% y/y) in textile product output. Production of energy materials jumped 2.0% (2.4% y/y), but durable materials production fell 0.9% (+1.6% y/y).

Amongst the special aggregate series, high-technology product production increased 0.4% (5.8% y/y) after two months of decline. Factory output excluding high technology products fell 0.5% (+0.6% y/y). Factory output excluding both high-tech and motor vehicles eased 0.2% (+0.6% y/y).

Capacity utilization increased to 76.1%, its highest point since January 2016. Factory sector utilization, however, fell to 75.3%, its lowest point in three months. 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.

The End of China's Export Juggernaut from the Federal Reserve Bank of New York is available here.

Industrial Production (SA, % Change) Mar Feb Jan Mar Y/Y 2016 2015 2014
Total Output 0.5 0.1 -0.3 1.6 -1.2 -0.7 3.1
Manufacturing -0.4 0.3 0.4 0.8 -0.0 0.1 1.2
    Consumer Goods 1.2 -0.7 -1.1 1.3 0.6 2.3 0.8
    Business Equipment -0.4 0.1 0.0 0.7 -1.8 -0.9 1.9
    Construction Supplies -0.8 1.4 1.4 2.3 1.3 0.5 3.4
  Materials 0.4 0.4 0.0 1.6 -2.3 -1.4 5.1
Utilities 8.6 -5.8 -6.8 4.6 -0.3 -0.7 1.4
Mining 0.1 2.9 1.3 3.0 -9.1 -4.3 10.7
Capacity Utilization (%) 76.1 75.7 75.7 75.4 75.7 76.8 78.6
 Manufacturing 75.3 75.6 75.4 75.2 75.1 75.5 75.4
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