Factories turned out more cars, appliances and home furnishings in August, propelling the biggest increase in U.S. industrial production in six months and indicating manufacturing will contribute more to the expansion.
Output at factories, mines and utilities rose 0.4 percent after no change the prior month, a report from the Federal Reserve showed last week in Washington. Manufacturing, which makes up 75 percent of total production, advanced by the most this year.
The figures showed strength in housing and autos is rippling through the economy, with a measure of appliance and furniture output climbing to the highest since 2009 and vehicle assemblies growing at the fastest pace in six years. A pickup in global markets and stronger consumer demand would help spark further progress in the sector that struggled earlier this year.
“Manufacturing should be a pretty decent contributor to growth over the second half of the year,” said Brett Ryan, a U.S. economist at Deutsche Bank Securities Inc. in New York, whose firm is the second-best forecaster of production for the past two years, according to data compiled by Bloomberg. “You have an elevated level of unfilled orders, so that bodes well for production.”
Another report from the Fed showed manufacturing in the New York region expanded less than forecast in September even as orders and sales grew at a faster pace. The Federal Reserve Bank of New York’s general economic index eased to 6.3 from 8.2 last month. Readings greater than zero signal expansion in New York, northern New Jersey and southern Connecticut. A gauge of the six-month outlook advanced to the highest since April 2012.
The median forecast in a Bloomberg survey of 85 economists called for a 0.5 percent advance in August industrial production.
Manufacturing, which accounts for about 12 percent of the economy, climbed 0.7 percent after falling a revised 0.4 percent. July factory output was previously reported as a 0.1 percent drop.
PBN is now accepting applications for its newest award program and event for RI & Bristol County to celebrate the Manufacturing Renaissance that is evolving regionally and across the country. The deadline for applications is March 20th.
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