Despite record low consumer sentiment (if you believe UMich), this morning saw the Empire Fed survey show New York state factory activity expanded in May at the fastest pace in four years, and firms grew more optimistic about the outlook.

That was followed by a much hotter than expected Industrial Production print (up 0.7% MoM vs +0.3% MoM exp and higher than the highest estimate) for April (and March's decline revised stronger), lifting annual growth up to +1.35% YoY...

Source: Bloomberg

April's gain for US industrial production was the largest since February 2025.

Manufacturing output rose 0.6 percent in April after edging up 0.1 percent in March.

The production of durables increased 1.2 percent in April, with gains in most categories.

The largest increase was in the output of motor vehicles and parts, which jumped 3.7 percent.

Nondurable manufacturing production edged down 0.1 percent, as declines in several categories - notably the indexes for chemicals and for plastics and rubber products, which both decreased 0.9 percent - were mostly offset by increases in the indexes for food, beverage, and tobacco products, for printing and support, and for petroleum and coal products.

Mining output edged down 0.1 percent in April after falling 1.6 percent in March. 

The output of utilities increased 1.9 percent in April, with gains in both electric and natural gas utilities.

Capacity Utilization continued to rise to 76.1% (better than the 75.8% expected)...

So, if Americans are so pissed off (UMich), why is production and factory activity (and retail sales) picking up?