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Bloomberg News / Landov
Numbers: Industrial production fell 0.1% in March, the Federal Reserve said Tuesday. The gain was lower than Wall Street expectations of a gain of 0.1%.
This is the fourth consecutive weak reading for industrial production. Production rose 0.1% in February after dropping 0.3% in January.
As a result, production in the first quarter declined 0.3% year-over-year after a 4% gain in the last three months of 2018. This is the lowest since the third quarter of 2017.
What happened: Manufacturing output remained unchanged in March after falling in the past two months. Auto production fell 2.5%. In the first quarter, automotive production was down 12.8% a year, the largest decline in almost eight years. Construction, equipment and commercial equipment have increased significantly.
Mining output, which was bright last year, fell 0.8% in March and has not risen since December. Utilities output rose 0.2% in the month.
The use of capacity fell to 78.8% in March, the lowest rate since last July. The capacity utilization rate reflects the limitations imposed on the operation of the country's factories, mines and utilities. It is still below pre-recession levels, above 80%, which could increase production costs and prices.
Big picture: Industrial production has been weak in recent months and no improvement was seen in March. The global economy appears to be slowing, causing a slowdown in export growth. Trade policy concerns arising from the tariffs implemented and in effect while the United States and China are negotiating have also had an impact. The data will add anxiety to the outlook for the US economy and keep the Federal Reserve on hold.
What they say: "The factories sector was hardest hit by the turmoil in tariffs and the uncertainties surrounding trade policy, as well as the problem of strengthening competitiveness.
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So it's no surprise that manufacturing is underperforming the global economy, "said Stephen Stanley of Amherst Pierpont Securities.
Market reaction: The Dow Jones Industrial Average
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Investors looked at a series of corporate profits. 10-year US Treasury returns
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increased by 2 basis points to 2.58%.
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