US industrial production, output at the nation’s factories, mines, and utilities, increased 1.3% in October, after falling a downwardly-revised 3.7% in September, according to the Federal Reserve. The number reflects a better-than-expected reversal after a production halt in the Gulf of Mexico and a strike at Boeing Co. led to the biggest decline in production in 60 years. October’s reading was significantly above estimations, as economists were expecting a 0.5% increase in output.
Capacity utilization, a key gauge of inflationary pressures, rose to 76.4% from 75.5%. This is the lowest level since October 2003. Lower capacity usually leads to slower inflation, as producers compete with each other for work.
Report Details (via MarketWatch):
Manufacturing output increased 0.6% in October after falling 3.7% in September. Output of mines increased 6.1%. Output of utilities increased 0.4%.
Output of motor vehicles and parts fell 3.5% in October and were down 18.4% in the past year. Vehicle assembles fell to an annual rate of 8.09 million from 8.41 million in September and 10.75 million in all of 2007. It was the fewest vehicle assemblies in 17 years.
Excluding motor vehicles, manufacturing output increased 0.8% in October.
The output of high-technology industries fell 0.9% in October, the third decline in a row. High-tech output was up 9.9% compared with October 2007.
Excluding high-tech, manufacturing output increased 0.7% in October.
Industrial output is down 4.1% in the past year.
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