Industrial production was surprisingly weak in March. With February posting an unrevised 0.2 percent dip, a 0.6 percent monthly fall was again well wide of the market consensus and means output has now declined in six of the last seven months. Annual workday adjusted growth was minus 3.2 percent, down from 2.3 percent and a 5-month low.

The monthly setback reflected fresh falls in consumer goods (1.4 percent), intermediates (0.4 percent) and energy (1.4 percent). Capital goods rose 0.7 percent and was the only category to record positive yearly growth (3.9 percent).

March's disappointing results leave the goods producing sector mired in the recession that started back in the third quarter of last year. Moreover, with France (minus 1.1 percent) and Germany (minus 3.4 percent) both seeing even steeper monthly declines, Eurozone industrial production almost certainly had a very poor March. This could lead to a downward revision to the region's first quarter GDP growth (provisionally just 0.1 percent). The Italian ECDI now stands at exactly zero indicating that overall economic activity is matching market expectations. However, at minus 10, the ECDI-P shows that the real economy is struggling to keep up.

Production in March is expected to rise 0.3 percent following February's weaker-than-expected 0.2 percent decrease.

Industrial production measures the physical output of the nation's factories, mines and utilities. Construction is excluded. Approximately 4,100 companies provide data on more than 8,000 monthly flows of production.

Investors want to keep their finger on the pulse of the economy because it usually dictates how various types of investments will perform. The stock market likes to see healthy economic growth because that translates to higher corporate profits. The bond market prefers more subdued growth that will not lead to inflationary pressures. By tracking economic data such as industrial production, investors will know what the economic backdrop is for these markets and their portfolios. Like the PPI and the orders data, construction is excluded from the data. This report has a big influence on market behavior. In any given month, one can see whether capital goods or consumer goods are growing more rapidly. Are manufacturers still producing construction supplies and other materials? This detailed report shows which sectors of the economy are growing and which are not.