U.S. industrial production plunges slightly less than forecast in April

The Federal Reserve reported on Friday the U.S. industrial production reduced 11.2 m-o-m in April, following a revised 4.5 percent m-o-m decline in March (originally a 5.4 percent m-o-m drop). That was the largest drop in the 101-year history of the index.

Economists had forecast industrial production would plunge 11.5 percent m-o-m in April.

According to the report, the COVID-19 pandemic led many factories to slow or suspend operations throughout the month. Manufacturing output fell 13.7 percent m-o-m, its largest decline on record, as all major industries recorded decreases, with motor vehicles and parts posting a 70 percent decline, while production elsewhere in manufacturing fell 10.3 percent. In addition, the indexes for utilities and mining dropped 0.9 percent and 6.1 percent, respectively.

Capacity utilization for the industrial sector decreased 8.3 percentage points m-o-m to 64.9 percent in April. That was 0.9 percentage point above economists' forecast but 14.9 percentage points below its long-run (1972-2019) average.

In y-o-y terms, the industrial output fell 15.0 percent in April, following a revised 4.9 percent decrease in the prior month (originally, -5.5 percent). That was the biggest decline since June 2009.