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First Cut: March industrial production disappoints with flat manufacturing and lower mining

Industrial production edged down 0.1% in March after a marginal upward revision in February to up 0.1% (previously unchanged) and a small downward revision to January to down 0.3% (previously down 0.1%). The month-over-month percent change was a disappointment relative to expectations, however, production was up 2.8% compared to a year-ago hinting that the underlying trend is still upward and production robust.

Manufacturing activity was flat in March from February, but managed to rise 0.2% excluding motor vehicles and parts production which fell 2.5%.

Mining declined 0.8%, with energy down 0.4%, although oil and gas well drilling was up 0.3%.

Utilities eked out a 0.2% even after the 3.7% increase in the prior month as weather remained cold for large parts of the US. Electricity costs were down 0.5%, but natural gas was up 3.8%.

Capacity utilization remains somewhat below its longer-term average of 79.8%, but is fairly stable and remains near post-recession highs.

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