US: Industrial activity remains solid - Nomura

Analysts at Nomura note that the US industrial production increased a solid 0.7% m-o-m in April, mostly in line with their and market expectations (Nomura and Consensus: 0.6%), following an upwardly revised 0.7% gain in March (previously reported as a 0.5% gain).

Key Quotes

“The strength was broad-based across sectors, consistent with our view that economic momentum remains firm.”

“One area of softness was auto and parts, which fell 1.3% m-o-m following a steady 2.8% gain in March. As the sales pace of autos continues to slow, production will likely adjust gradually.”

“Ex-auto factory output rose a robust 0.6% m-o-m in April following a 0.2% decline in March. In particular, ex-auto durable goods production rose by 0.8% with broad-based strength. The machinery and computer sectors saw strong 2.3% and 1.2% growth in output, respectively. Ex-auto transportation equipment output increased a healthy 1.5%. Firm growth in durable goods manufacturing output indicates to healthy momentum in business spending on equipment in Q2. In addition, the mining sector continued to boost industrial activity. Mining output rose 1.1% m-o-m in April, boosted by ongoing strength in oil and gas well drilling (up 3.0% m-o-m). Elevated oil prices will continue to support this sector in the near term. Finally, utility output rose 1.9% m-o-m in April. Gas utility output jumped 10.3% m-o-m, driven by strong demand for heating due to below-normal temperatures.”

“Although incoming business surveys such as April ISM and May Empire State surveys point to continued optimism, trade concerns remain as a risk, which could exert downward pressure on business confidence.”

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility.