US Industrial Production Falls More than Expected

Industrial output in the United States declined 0.4 percent in May from April of 2016, following a downwardly revised 0.6 percent rise in the previous period and worse than market expectations of a 0.2 percent drop. Automobiles and electricity accounted the most for the decline, offsetting a rebound in coal mining.
Federal Reserve | Joana Taborda | 6/15/2016 2:29:24 PM
The output of manufacturing moved down 0.4 percent after gaining 0.2 percent in April. Production of durables declined 0.7 percent, nondurables was little changed and other manufacturing (publishing and logging) fell 0.6 percent. The largest drop among durable goods, 4.2 percent, was recorded by motor vehicles and parts. In addition, the indexes for wood products and machinery fell 1.0 percent or more. Several durable goods industries posted increases, but miscellaneous manufacturing was the only industry to register a gain of more than 1.0 percent. Within nondurables, increases for food, beverage, and tobacco products and for paper offset declines elsewhere; printing and support activities recorded the largest decrease.

The index for utilities fell 1.0 percent as a drop in the output of electric utilities was partly offset by a gain for natural gas utilities. 

After eight straight monthly declines, the production at mines moved up 0.2 percent, due to a rebound in coal mining, which had declined in each of the previous eight months, and a gain in nonmetallic mineral mining.

At 103.6 percent of its 2012 average, total industrial production in May was 1.4 percent below its year-earlier level. 

Capacity utilization for the industrial sector decreased 0.4 percentage point in May to 74.9 percent, a rate that is 5.1 percentage points below its long-run (1972–2015) average.

US Industrial Production Falls More than Expected