With utilities output showing a substantial increase in the month of April, the Federal Reserve released a report Wednesday morning showing a much bigger than expected increase in overall industrial production for the month.
The Fed said industrial production increased by 1.1 percent in April, far exceeding economist estimates for an increase of about 0.5 percent.
At the same time, the report said production fell by 0.6 percent in March after rising by 0.4 percent in February. Production was previously estimated to have been unchanged in both months.
The bigger than expected increase in production in April was largely due to a 4.5 percent jump in utilities output, which came after a 0.7 percent increase in the previous month.
The Fed said that the jump in utilities output came after unseasonably warm weather in the first quarter held down demand for heating.
Mining output increased by 1.6 percent in April after falling by 1.7 percent in March, while manufacturing output rose by 0.6 percent following a 0.5 percent drop.
"Overall, the report is consistent with firm growth, and with the ISM manufacturing headline index close to the 55 level, we expect this to continue through the rest of this quarter," said James Knightley, senior economist at ING. "In turn, this bodes well for ongoing employment gains in the sector."
The report also showed that capacity utilization rose to 79.2 percent in April from a revised 78.4 percent in March. Economists had expected capacity utilization to edge up to 79.0 percent from the 78.6 percent originally reported for the previous month.
The Fed noted that the capacity utilization rate is 3.1 percentage points above its level a year ago but is 1.1 percentage points below its long-run average.
Capacity utilization in the utilities sector rose to 76.4 percent in April from 73.3 percent March, while capacity utilization in the mining sector climbed to 88.8 percent from 87.5 percent and capacity utilization in the manufacturing sector crept up 77.9 percent from 77.6 percent.
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June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.