U.S. February Industrial Production - Firm start to 2026 may lose momentum
February industrial production has seen moderate gains of 0.2% both overall and in manufacturing to follow strong gains of 0.7% and 0.8% respectively in January. This backs stronger recent data from the ISM and other surveys, but may be difficult to sustain if the Middle East crisis persists.
Mining increased by 0.8% in a second straight rise, though a December drop has not been fully eased. Mining may be one of the few sectors to gain from a rise in energy prices. The mining gain was offset by a 0.6% decline in utilities, though here strength in December has been only marginally corrected.
Manufacturing increased by 0.2% but by only 0.1% excluding autos and was unchanged excluding autos and high tech. Even the latter marks a positive start to 2026 given a 0.6% increase in January, but it is unclear whether this will persist.
March’s Empire State manufacturing survey released earlier today slipped back to near neutral after two straight positives at 7.1 in February and 7.7 in January, casting some doubt on the sustainability of the recent improvement in manufacturing data. Price indices were also softer, though this may not be sustainable as energy prices surge.
