US Industrial Output Rises the Most in 6 Months


US industrial output rose 0.4 percent from a month earlier in May 2019, reversing a 0.4 percent fall in April and beating market expectations of a 0.2 percent gain. That was the biggest increase in industrial production since November last year, boosted by a rebound in manufacturing and utilities output.

Manufacturing output increased 0.2 percent in May after having decreased about 0.4 percent per month, on average, in the first four months of the year. In May, the production of durable goods rose 0.3 percent, while the output of nondurable goods edged up 0.1 percent. Among durables, gains of more than 1 percent were posted by wood products; machinery; electrical equipment, appliances, and components; and motor vehicles and parts. These increases were partially offset by decreases in primary metals and in aerospace and miscellaneous transportation equipment. Among nondurables, the only gain greater than 1 percent was recorded by plastics and rubber products, and the only decline greater than 1 percent was recorded by apparel and leather products. The index for other manufacturing (publishing and logging) decreased 0.9 percent last month; it has fallen 6.5 percent during the past 12 months.

The output of utilities increased 2.1 percent in May, with identically sized gains in the indexes for both natural gas and electric utilities. Mining output inched up 0.1 percent in May and was 10.0 percent above its level of a year earlier. The increase in the mining index for May reflected gains in oil and natural gas extraction that were mostly offset by a large decline for oil and gas well drilling.

Capacity utilization for the industrial sector moved up 0.2 percentage point in May to 78.1 percent, a rate that is 1.7 percentage points below its long-run (1972–2018) average. Capacity utilization for manufacturing moved up 0.1 percentage point in May to 75.7 percent, a rate that is 2.6 percentage points below its long-run average. The utilization rates for durable and nondurable manufacturing were little changed, while the rate for other manufacturing (publishing and logging) slipped 0.4 percentage point. Capacity utilization for mining dipped to 91.3 percent but remained well above its long-run average of 87.1 percent. The operating rate for utilities jumped to 77.5 percent; even so, it was still about 8 percentage points below its long-run average.

US Industrial Output Rises the Most in 6 Months


Federal Reserve | Joana Ferreira | joana.ferreira@tradingeconomics.com
6/14/2019 1:24:30 PM