Industrial Production in U.S. Unchanged as Utility Use Drops

Industrial production in the U.S. was unchanged in May as a drop in utility use offset gains in manufacturing and mining.

Last month’s output at factories, mines and utilities followed a revised 0.4 percent decrease in April that was smaller than previously reported, a Federal Reserve report showed today in Washington. The median forecast in a Bloomberg survey called for a 0.2 percent advance. Manufacturing, which makes up 75 percent of total production, increased 0.1 percent after falling 0.4 percent.

Business investment has eased as the economy navigates the effects of this year’s across-the-board U.S. government budget cuts and higher taxes. At the same time, the auto industry remains a bright spot for manufacturing, which has been hindered by a recession in Europe and a slowdown in China.

“It’s partly the soft-global-growth story,” Scott Brown, chief economist at Raymond James & Associates in St. Petersburg, Florida, said before the report. “You’re seeing strength in things like autos. Everything else seems to be a bit spotty, and some of that is just softer consumer demand in general.”

Stock-index futures held losses after the report, with the contract on the Standard & Poor’s 500 Index maturing this month falling 0.1 percent to 1,628.7 at 9:18 a.m. in New York.

Estimates of the 85 economists surveyed by Bloomberg ranged from a drop of 0.4 percent to an increase of 0.7 percent. The prior month was previously reported as a 0.5 percent decrease. Manufacturing accounts for about 12 percent of the economy.


This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Dean Popplewell

Dean Popplewell

Vice-President of Market Analysis at MarketPulse
Dean Popplewell has nearly two decades of experience trading currencies and fixed income instruments. He has a deep understanding of market fundamentals and the impact of global events on capital markets. He is respected among professional traders for his skilled analysis and career history as global head of trading for firms such as Scotia Capital and BMO Nesbitt Burns. Since joining OANDA in 2006, Dean has played an instrumental role in driving awareness of the forex market as an emerging asset class for retail investors, as well as providing expert counsel to a number of internal teams on how to best serve clients and industry stakeholders.
Dean Popplewell