The Federal Reserve reports that overall industrial production declined 0.3 percent in March, higher than the consensus expected decrease of 0.2%. Capacity utilization fell 1.1% to 78.5% in March and is at a level more than 3½ percentage points below its 1967-2000 average. Year-over-year comparisons of industrial production turned negative in April, the first time since the last recession in the early nineties. While economists expect further rate cuts by the Federal Reserve, conflicting indicators indicate the economy is still in a precarious situation.
Industry Groups
Manufacturing output fell 0.3 percent in April and has contracted nearly 3.5% since its most recent peak in September 2000. The production of automotive products grew by 0.6% after a stronger gain in March, however output remained below the level posted before the industry began a downturn in October 2000. The production indexes declined for most other consumer durables and for consumer energy products.
The production of business equipment decreased 1.1 percent in April. The sector has fallen four of the past five months. Industrial and other equipment fell nearly 2% in April, with sharp declines in construction equipment, metalworking and farm machinery. The output for information processing equipment declined 0.4%, pushed down by continued weakness in the production of communications equipment and computers.
The factory operating rate declined to 77.1 percent in April, more than 3½ percentage points below its 1967-2000 average. The utilization rate for primary processing industries decreased 1.5% to 77.1 percent, while the rate for advanced processing industries slipped to 77.7 percent. Capacity utilization in the high tech sector dropped for the ninth consecutive month to 73.4 percent, more than 6.5 percent below its July 2000 peak. The operating rate at utilities dropped to 89.6 percent. The operating rate for mining registered its fourth consecutive increase to 89.64 percent.
Monthly Reports
| Industrial Production Index 1992=100 *revisions possible for previous months |
| Jan. | Feb. | March | April | |
| Total Index | 146.0 | 145.5 | 145.3 | 144.9 |
| Manufacturing | 151.3 | 150.7 | 150.3 | 149.8 |
| Durable | 192.3 | 191.0 | 191.9 | 190.7 |
| Nondurable | 114.0 | 114.0 | 112.8 | 112.8 |
| Utilities | 124.0 | 123.1 | 123.6 | 122.3 |
Market Groups, Losers and Gainers
| Industrial Production *revisions possible for previous months | ||||
| Jan. | Feb. | March | April | |
| Automotive Products | 133.8 | 136.5 | 144.9 | 145.8 |
| Chemical Products | 139.1 | 141.6 | 141.8 | 142.1 |
| Industrial Equipment | 146.7 | 144.7 | 145.2 | 142.5 |
| Basic Metals | 124.0 | 122.1 | 120.2 | 119.0 |
| Semiconductors | 2297.1 | 2270.9 | 2239.0 | 2214.2 |
Read the latest report on Industrial Production and Capacity Utilization from the Federal Reserve Board.