Industrial Production: Rebound Led By Autos

Bottom Line: After a surprise miss in January Industrial production in February increased sharply. While weather caused declines in the utilities sector, overall gains were led by mining and a sharp rebound in auto manufacturing. Ex autos and tech gains were steady, up 1.1% on the month. And while the 3-month average for this metric is slightly slower than the 6-month average, it still shows modest acceleration in the pace of overall industrial production on a trend basis. Industrial Production ROSE by 1.06% in February, compared with market expectations for an increase of 0.4%. However, the prior month was revised from -0.1% down to -0.3%. Output is now 4.4% ABOVE its year ago level. In February, Mining Output ROSE by 4.4%, and is now 9.7% ABOVE its year ago level. Utility Generation FELL by 4.7% and is now 10.6% ABOVE its year ago level. Manufacturing Output ROSE by 1.2% and is now 2.5% ABOVE its year ago level. Output in high-tech industries rose by 1.1%. Meanwhile, output in the motor vehicle industry rose by 3.9%. Excluding both the high-tech and motor vehicles industries, industrial output climbed by 1.1%. Capacity Utilization ROSE by 0.7 points to 78.1%, compared with market expectations for a smaller increase to 77.7%. Moreover, the prior month was revised from 77.5% to 77.4%. Capacity utilization rate is now 2.3 percentage points above its year ago level and 1.9 percentage points below its long-run (1972–2015) average.