Newequipment 76 Plant Operations Workers Assembling Engine
Newequipment 76 Plant Operations Workers Assembling Engine
Newequipment 76 Plant Operations Workers Assembling Engine
Newequipment 76 Plant Operations Workers Assembling Engine
Newequipment 76 Plant Operations Workers Assembling Engine

Factory Production in U.S. Rises for Fourth Time in Five Months

Feb. 15, 2017
Healthy consumer spending and a recovery in the oil sector have supported recent gains in manufacturing, with a key gauge of industry rising last month to the highest since November 2014.

Author: Patricia Laya

U.S. factory output increased for the fourth time in five months amid gains in machinery and chemicals, extending a gradual recovery in manufacturing.

Production at factories, which make up about 80% of all output, increased 0.2% in January from the previous month, a Federal Reserve report showed Wednesday. That matched the median forecast in a Bloomberg survey. Total industrial output, which includes mining and utilities, fell 0.3% as warm weather reduced demand for heating.

Healthy consumer spending and a recovery in the oil sector have supported recent gains in manufacturing, with a key gauge of industry rising last month to the highest since November 2014. At the same time, modest overseas demand, a strong U.S. dollar and soft investment in equipment from domestic firms have made for slow progress.

Estimates in the Bloomberg survey for manufacturing output, which accounts for about 12% of the economy, ranged from a decline of 0.1% to an increase of 0.6%. The previous month’s reading of a 0.2% gain was unrevised.

For total industrial production, the Bloomberg survey showed estimates ranging from a 0.6% drop to a rise of 0.4%, with a median projection for no change.

Capacity utilization, which measures the amount of a plant that is in use, declined to 75.3% in January from a revised 75.6% the prior month.

Utility Output

Utility output dropped 5.7% after December’s 5.1% gain. Last month was the 18th-warmest January in the last 123 years, according to the National Oceanic and Atmospheric Administration.

Mining production, including oil drilling, expanded 2.8% in January after a 1.4% drop. Drilling of oil and gas wells jumped 8.5%.

U.S. rig counts increased to 741 in the week ended Feb. 10, the highest in more than a year, helped by increasing energy prices, Baker Hughes Inc. data show.

Consumer durable-goods output fell 0.9% last month on a 2.8% drop in automotive production. Business equipment production ticked up 0.1% following a 0.8% increase.

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