US Industrial Production Hits One-Year High
Industrial output in the United States rose to a one-year high in November, as manufacturing activity continues to drive economic expansion.
Industrial production in factories, mines and utilities rose 1.1 percent in November after a revised gain of only 0.1 percent in October, according to the Federal Reserve. Economists polled by Bloomberg forecasted a gain of 0.6 percent. The industrial production index rose to 101.3, the highest since December 2007.
Gains were broad-based, official data from the Federal Reserve showed. Manufacturing output rose for the fourth consecutive month at a pace of 0.6 percent. Manufacturing output was 2.9 percent above year-ago levels, but 3.6 percent below the pre-recession peak. Mining production increased 1.7 percent after a 1.5 percent decline in October, which was attributed to temporary shutdowns in oil rigs in the Gulf of Mexico. Utilities rose 3.9 percent, as frigid temperatures increased demand for heating.
The monthly figures “suggest that the manufacturing sector is gaining a little bit of momentum,” said David Sloan of 4cast Inc. “You’ve got a decent underlying picture of respectable, if not terribly rapid, growth.”
Government data were accompanied by a separate PMI report showing manufacturing output in the world’s largest economy remained strong toward the end of the fourth quarter. Manufacturing output dipped marginally in December, according to Markit Group, but remained elevated due to improving business conditions and growing client demand.
Manufacturing accounts for three-quarters of total production in the US economy. The back-to-back monthly increases in total manufacturing output were the strongest this year, suggesting the US economy was expanding at a strong pace shortly after the 16-day government shutdown.
The US dollar was unable to translate strong industrial output into meaningful gains, falling more than 0.1 percent against a basket of its major peers.
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