Production at U.S. factories jumped up more than expected in April in the middle of a never-ending heavy demand for motor vehicles and other items, which should help to support manufacturing work.
The Federal Reserve, on Tuesday, said that the manufacturing output increased 0.8% in April after a similar rise in March. But manufacturing, which is 12% of the economy, is facing difficulties from renewed supply chain bottlenecks because of the Russia- Ukraine war and China’s zero-tolerance COVID-19 policy.
In April, the index of national factory activity of the Institute for Supply Management hit more than a 1-1/2-year low. A survey on Monday from the New York Fed revealed that factory activity in New York State went down in May for the third time in 2022.
The dollar has gained 2.7% against the currencies of the major trade partners of the USA because of Fed increasing interest rates in March. This could hit the demand for exports and undersell manufacturing.
Auto plant production increased by 3.9% in April after shooting to 8.3% in March. The increasing crude oil prices have given a boost to the production at mines. Utility production bounced back 2.4% after going down 0.3% in March.