US industrial production rebounds in May
US industrial production rebounded in May, a sign factory output was playing a bigger role in supporting growth in the second quarter.
Total industrial production advanced at a pace of 0.6 percent in May, following a revised drop of 0.3 percent in April, the Board of Governors of the Federal Reserve reported today in Washington. Market analysts forecast industrial production to rise 0.5 percent in May.
Year-on-year, total production rose 4.3 percent, official data showed.
Manufacturing production, which accounts for approximately 12 percent of the US economy, climbed 0.6 percent in May, following a drop of 0.1 percent in April. Year-on-year, manufacturing production was up 3.6 percent.
On June 2 the Institute for Supply Management said the US manufacturing sector expanded sharply in May, as growth in new orders and production supported job creation for the eleventh straight month. Seventeen of the 18 manufacturing sub-sectors reported growth in May, ISM data showed.
Mining output, which includes oil drilling, climbed 1.3 percent, following a gain of 1.6 percent in April. Compared to the previous 12 months, mining was up 9.7 percent. The mining sector was the only major industry group to post gains in April.
Utilities output declined for the fourth consecutive month at a rate of 0.8 percent. Year-on-year, mining production was up 0.6 percent.
Industrial capacity utilization, which is used to gauge how fully companies are using their factory resources, increased 0.2 percentage points to 79.1. Economists forecast no change from the previous month’s reading of 78.9.
The production of consumer goods increased 0.1 percent last month to a level that is 3.1 percent higher than May 2013, the Fed reported showed.
The production of business equipment increased for the fourth consecutive month at a rate of 0.8 percent. Compared to May 2013, business equipment production is up 5.3 percent.
The production of defense and space equipment declined 0.3 percent in May following no change the previous month. Year-on-year, production in this market group is up 2.6 percent higher.
Industrial production unexpectedly slowed in April, as broad-based declines in manufacturing and utilities offset growth in the mining sector. The April reading raised concern the economy would need more time to regain momentum after first quarter growth fell to its lowest rate in three years.
US gross domestic product contracted 1 percent annually between January and March, according to a revised estimate from the Commerce Department. Economists say the economy is on pace to expand more than 3 percent annually between April and June.
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