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US manufacturing output takes surprise dip in February
[WASHINGTON] US manufacturing output fell in February for the third straight month as automobile production tumbled, pointing to slower economic growth in the first quarter.
Factory production slipped 0.2 per cent last month after a revised 0.3 per cent decline in January, the Federal Reserve said on Monday. Auto production fell 3.0 per cent last month.
Economists polled by Reuters had forecast that manufacturing output would edge up 0.1 per cent in February after a previously reported 0.2 per cent gain in January.
Mining output dropped 0.2 per cent last month, primarily due to declines in the coal, oil and gas well drilling, and servicing sectors. Utilities production jumped 7.3 per cent as a cold snap boosted demand for heating.
The rise in utilities, however, was insufficient to offset the drag from manufacturing and mining, leaving overall industrial production gaining only 0.1 per cent in January.
The amount of manufacturing capacity in use slipped to 77.3 per cent last month from 77.6 per cent in January.
Overall industrial capacity use dipped to 78.9 per cent from 79.1 per cent.
Officials at the Fed tend to look at capacity use as a signal of how much "slack" remains in the economy and how much room there is for growth to accelerate before it becomes inflationary.