By John S. McClenahen One month's data, even when the numbers are from the Federal Reserve Board, do not make for an economic trend. Yet the fact that U.S. industrial production advanced 0.4% in March, after five months of falling figures, is encouraging -- "a welcome first sign of recovery," opines Jerry J. Jasinowski, president of the National Assn. of Manufacturers (NAM), Washington. "However, until overall demand growth improves, factory output should remain soggy," believes Stan Shipley, a senior economist at Merrill Lynch & Co., New York. He notes, for example, that without a surprisingly strong 7% gain in motor vehicle production in March and an anemic 0.9% advance in high-technology goods, factory output would have fallen 0.2% last month. Indeed, the factory utilization rate during March fell to 78.1%, its lowest rate in nearly 10 years. NAM's Jasinowski continues to press chairman Alan Greenspan and his Federal Reserve colleagues for lower interest rates, urging an immediate 50-basis-point cut in the influential federal funds rate to 4.5% and a further reduction to 4% "if conditions remain poor." But Maury Harris, an economist at UBS/PaineWebber, no longer expects an interest-rate cut before the next scheduled meeting of the Federal Open Market Committee (FOMC) on May 15. "Industrial production data are assembled by the Fed, and the strength in some of the incoming March output data explains why the Fed didn't cut the federal funds rate in response to the weak earlier labor and retail-sales reports for March," he says. Harris, however, does foresee the FOMC cutting short-term interest rates by 50 basis points in mid-May -- and a 3.5% federal funds rate before September.