Industrial Production: Stronger Than Expected But Mixed Revisions

Bottom Line: Industrial production rose more than expected in April. And while there were positive revisions to March data, February data was revised sharply lower. Still, the last three months have averaged 7.8% annualized growth, a sharp acceleration from the 6- and 12-month averages. Mining and motor vehicle production has driven much of the acceleration, but we've also seen solid gains in other industries, including aerospace. Overall, looking through the volatility of the mining and auto sectors, the trend is steady in the area of 1.5 - 2% annualized gains. Industrial Production ROSE by 0.72% in April, compared with market expectations for an increase of 0.6%. Moreover, the prior month was revised from 0.5% up to 0.7%. Output is now 3.5% ABOVE its year ago level. In April, Mining Output ROSE by 1.1%, and is now 11.3% ABOVE its year ago level. Utility Generation ROSE by 1.9% and is now 4.7% ABOVE its year ago level. Manufacturing Output ROSE by 0.5% and is now 1.9% ABOVE its year ago level.Output in high-tech industries rose by 0.8%. Meanwhile, output in the motor vehicle industry fell by 1.3%. Excluding both the high-tech and motor vehicles industries, industrial output climbed by 0.6%. Capacity Utilization ROSE by 0.4 points to 78.0%, compared with market expectations for a higher increase to 78.4%. Moreover, the prior month was revised from 78.0% to 77.6%. Capacity utilization rate is now 1.8 percentage points above its year ago level and 2.0 percentage points below its long-run (1972–2015) average.