US Industrial Production Falls Unexpectedly in May

US industrial production edged down 0.1 percent month-over-month in May 2018, following an upwardly revised 0.9 percent growth in April and missing market expectations of a 0.2 percent gain.

Manufacturing production fell 0.7 percent in May, following a 0.6 percent advance in the previous month, largely because truck assemblies were disrupted by a major fire at a parts supplier. Durable manufacturing slumped 1.2 percent (vs 0.4 percent in April), as output shrank for: motor vehicles and parts (-6.5 percent vs -2.2 percent); primary metals (-2 percent vs -0.8 percent); electrical equipment, appliances, and components (-1.2 percent vs 2.3 percent); machinery (-0.9 percent vs 2.3 percent); and fabricated metal products (-0.2 percent vs -0.1 percent). Meanwhile, computer and electronic products output was unchanged (vs 1.4 percent in April). In addition, nondurable manufacturing edged down 0.1 percent, after a 0.7 percent advance in April, due to a drop in output of food, beverage, and tobacco products (-0.2 percent vs 1.2 percent) and petroleum and coal products (-1.1 percent vs 0.6 percent), while chemicals production rose 0.5 percent (vs 0.4 percent in April). Excluding motor vehicles and parts, factory output moved down 0.2 percent.

Mining output rose 1.8 percent in May, following a 1 percent gain in April, reflecting continued gains in the oil and gas sector.

The index for utilities advanced 1.1 percent in May after a 3.2 percent jump in April, as a gain for electric utilities (4.2 percent vs 1.7 percent) outweighed a drop for gas utilities (-15.7 percent vs 12.6 percent).

Capacity utilization for manufacturing fell 0.6 percentage point to 75.3 percent in May, a rate that is 3.0 percentage points below its long-run average. The operating rate for durables decreased nearly 1 percentage point, and the rate for nondurables edged down. The utilization rate for mining jumped to 92.4 percent, which is about 5 1/2 percentage points higher than its long-run average. The rate for utilities rose about 1/2 percentage point but was still nearly 6 percentage points below its long-run average.

US Industrial Production Falls Unexpectedly in May

Federal Reserve | Joana Ferreira |
6/15/2018 1:35:44 PM