Economic Watch: Industrial Production, E-Commerce Jump; Home Starts Drop
Industrial production in the U.S. rose in April more than expected and by the fastest rate in more than three years, according to a new report issued Tuesday. Meanwhile, separate reports show e-commerce continues to boom but the building of new homes fell for the second straight month.
The total output at the nation’s factories, mines and utilities increased 1% from the month before, marking the biggest gain since February 2014, according to the Federal Reserve, and far better than a 0.4% gain expected from a consensus estimate by analysts.
Pushing the overall figure higher was a 1% increase in factory production after falling 0.4% in March and a 1.2% improvement in the output from mines, following a drop of 0.4% the month before. Utility output moderated to a 0.7% increase after leaping 8.2% in March.
At 105.1% of its 2012 average, total industrial production in April was 2.2% above its year-earlier level.
Capacity utilization for the industrial sector increased 0.6 of a percentage point in April to 76.7%, but was 3.2 percentage points below its 1972–2016 average.
Wells Fargo Securities noted that April is the first time in recent memory that all three major industry groups were higher with manufacturing, mining and utilities all posting gains of at least 0.7% on the month.
“One lesson from the ups and downs of the manufacturing recovery in this cycle is to curb your enthusiasm when the data finally indicate firming in activity,” cautioned Tim Quinlan, senior economist at Well Fargo Securities. “The latest print of the Institute for Supply Management manufacturing survey showed a big dip in the orders component [during April].”
E-Commerce up Nearly 15% from Year Earlier
Meantime, a separate report, also released Tuesday, showed first quarter e-commerce retail sales in the U.S. grew 4.1% from the final quarter of 2016 while increasing faster than …Read the rest of this story
