U.S Industrial Production jumped 0.7% in April, considerably topping market expectations for a 0.2-0.3% gain and a major rebound after a 0.3% decline in March.

On an annual basis, production accelerated to a 1.4% gain in April after a 0.8% March increase.

The Federal Reserve’s latest Industrial Production and Capacity Utilization report, issued May 15, showed that manufacturing output likewise jumped 0.6% in April month-over-month after a 0.1% uptick in March.

The April indexes for mining ticked down 0.1% MoM and utilities output improved 1.9%. Excluding automotive, manufacturing output increased 0.3%.

Meanwhile, U.S. industrial capacity utilization improved to 76.1% — a rate that is 3.3 percentage points below its long-run (1972–2025) average. At 102.5% of its 2017 average, total industrial production was 1.4% above its year-earlier level.

U.S. Industrial Production: Month-Over-Month % Change

U.S. Industrial Production: Year-Over-Year % Change

Market Groups

The major market groups posted mostly positive results in April. The production of consumer goods moved up 0.9%, with gains in both durable and nondurable consumer goods. The index for business equipment jumped 1.5%, boosted by a gain of 4.2% in transit equipment. The output of defense and space equipment rose 1.9%, the output of construction supplies was little changed, and the output of business supplies increased 0.3%. The index for materials moved up 0.5%, led by increases in the output of durable materials and energy materials, while the output of non-energy nondurable materials declined.

Industry Groups

Manufacturing output rose 0.6% in April after edging up 0.1 percent in March. The production of durables increased 1.2% April, with gains in most categories. The largest increase was in the output of motor vehicles and parts, which jumped 3.7%. Nondurable manufacturing production edged down 0.1%, as declines in several categories — notably the indexes for chemicals and for plastics and rubber products, which both decreased 0.9% — were mostly offset by increases in the indexes for food, beverage and tobacco products, for printing and support, and for petroleum and coal products.

Mining output edged down 0.1% in April after falling 1.6% in March. The output of utilities increased 1.9% in April, with gains in both electric and natural gas utilities.

Capacity utilization for manufacturing moved up 0.4 percentage points to 75.8% in April and is now 2.4 percentage points below its long-run (1972–2025) average. The operating rate for mining edged down 0.1 percentage point to 84.6%, and the operating rate for utilities increased 1.1 percentage points to 71.1%. The utilization rates for mining and for utilities were 0.6 percentage points and 12.9 percentage points below their long-run averages, respectively.