US industrial production rose by 0.7% in March vs consensus expectations of a 0.4% gain in March. This is even more impressive as February monthly gain was revised up from 0.6% to 1.2%. The 3-month % change, annualized, is now at nearly 7%. This is the fastest three-month growth in IP since July 2010. Capacity utilization accelerated significantly over the first quarter of the year. Capacity utilization is now almost back to pre-crisis levels and is at its highest level since July 2008. Economic utilizations (capacity utilization minus the unemployment rate) continues to improve as well.
Housing starts once again failed to top 1 million. March's number came in at 946K vs expectations of 965K. On the bright side, February's level was revised slightly higher to 920K. On a year-over-year basis housing starts remain negative (-5.9%). After advancing significantly in 2011 and most of 2012, housing starts have now remained relatively stable since the end of 2012.
