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Industrial Production: Continued Re-Acceleration

May 17, 2022
Bottom Line: Industrial production rose even more than expected in April as the auto industry led a volatile but robust reacceleration continued to take shape. Motor vehicle and part production were up 36+% over the three months ended in April, a notable acceleration from the already robust three- and six-month pace of 17.9% and 16.9%, respectively. The aerospace industry also saw an acceleration in production. Overall, US industrial production remains robust. After hints of decelerating activity, IP has the potential to re-accelerate if automakers and aerospace companies can get the chips they need to build cars and planes and meet record demand.
Industrial Production ROSE by 1.08% in April, compared with market expectations for an increase of 0.5%. Output is now 6.4% ABOVE its year-ago level.
In April, Mining Output ROSE by 1.6%, and is now 8.7% ABOVE its year-ago level. Utility Generation ROSE by 2.4% and is now 7.5% ABOVE its year-ago level.
Manufacturing Output ROSE by 0.8% and is now 5.8% ABOVE its year-ago level. Output in high-tech industries fell by 0.3%. Meanwhile, output in the motor vehicle industry rose by 3.9%. Excluding both the high-tech and motor vehicles industries, industrial output climbed by 0.6%.
Capacity Utilization ROSE by 0.8 points to 79.0%, compared with market expectations for a smaller increase to 78.6%.  Moreover, the prior month was revised from 76.8% to 78.2%. The capacity utilization rate is now 4.2 percentage points above its year-ago level and 1.0 percentage points below its long-run (1972–2015) average.
Article by Contingent Macro Advisors