Industrial production up 0.7% in April

Lloyd Doyle
May 17, 2018

COLD weather and strong mining activity combined with a solid showing by manufacturing firms to drive a jump in U.S. industrial production in April, the Federal Reserve reported on Wednesday.

The economy's industrial segment is firming but not to the extent that inflation seems about to surge, according to one closely watched measure of industrial slack.

Even so, analysts at Barclays Research said the figures were "a touch stronger" than they had expected.

The output of mining rose 1.1% after increasing 0.8% in March.

Total industrial capacity in use in the month rose to 78 per cent, the highest since March 2015 but still almost two points below the long-run average, the Fed said.

Capacity use is still almost 2 percentage points below the economy's historical average dating back to the early 1970s.

US industrial production rose slightly faster than expected in April, a third straight monthly increase that was supported by gains in every major market group.

Production of industrial machinery jumped 2.3 percent in April, the most in seven months. Manufacturers increased output of consumer goods, business equipment, and defense and space equipment. In the past year, production has increased a modest 1.8 percent. Production of durable goods decreased 0.5%, while nondurable goods production rose 1.5%.

Motor vehicle output fell 1.3% but mining output, which includes oil and gas production, rose 1.1% and utility output was up 1.9%. Unusually cold weather in April boosted demand for heating.

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