U.S. industrial production fell in May following a slight increase in April, while factory output flipped to an increase after an April decline.

The Federal Reserve’s latest Industrial Production and Capacity Utilization report, issued on June 17, showed total industrial production fell 0.2% in May month-over-month. Production increased 0.1% in April and declined 0.3% in March.

Economists polled by national media outlets forecasted a flat to 0.1% decline in May.

Total May production was impacted by a decrease in utilities output of 2.9%, partially offset by an increase in manufacturing and mining of 0.1% and 0.1% respectively, The manufacturing increase followed a 0.4% decline in April.

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At 103.6% of its 2017 average, total industrial production increased 0.6% year-over-year. Capacity utilization moved down to 77.4%, which was 2.2-percentage-points below its long-run (1972-2024) average.

U.S. Total Industrial Production Index – Month-Over-Month

source: tradingeconomics.com

Market Groups

Market groups saw mixed results in May. Among the index for consumer goods, most categories reported growth, including automotive products which increased 3.9%. The production of nondurables saw a decrease of 0.8%, held down by a decline of 3.2% in energy nondurable consumer goods which was partially offset by an increase in non-energy goods.

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Business equipment increased 0.8%, supported by an increase in transit equipment of 6.4%.

Industry Groups

Within May’s 0.1% monthly increase in manufacturing output, durable good production increased 0.4%, with mixed results across it subcategories. Conversely, the index for other manufacturing (publishing and logging) saw a decline of 0.8%.

Mining output increased 0.1% in May month-over-month, while utilities declined 2.9%, as a decline in the output of electric utilities more than offset a rise in the output of natural gas utilities.