U.S. Industrial Production Rose 1.6% in December
U.S. industrial production increased solidly in December, providing a source of strength for the U.S. economy as consumer spending and employment gains slow.
Industrial production, a measure of factory, mining and utility output, increased a seasonally adjusted 1.6% in December, the Federal Reserve said Friday. Economists surveyed by The Wall Street Journal expected a 0.5% rise.
Production was boosted by the utilities sector, as demand for heating picked up following warmer-than-usual November weather, the Fed said. Utilities output increased 6.2% in December from the prior month.
Manufacturing output, the biggest component of industrial production, climbed 0.9% in December from the prior month. Manufacturing, which has regained much of the ground lost earlier in the pandemic, saw production end the year down 2.8%.
“The December production data underline that while new restrictions are holding back parts of the service sector again, the recovery in manufacturing continues largely unaffected,” said Michael Pearce, economist at Capital Economics, in a note to clients.
Mining output rose 1.6% over the month, driven by drilling and extraction in the oil-and-gas sector.
Industrial production decreased sharply in March and April as the coronavirus pandemic took hold in the U.S., but has gradually recovered in subsequent months. Overall output in December was still down 3.6% from a year earlier, according to the Fed.
Capacity utilization, which reflects how much industries are producing compared with what they could potentially produce, increased to 74.5% in December from 73.4% in November.
Source: Dow Jones