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US industrial output jumps as auto production surges

[WASHINGTON] US industrial output advanced at its strongest pace in eight months in July as auto production surged in a bullish signal for third-quarter economic growth.

Industrial production shot up 0.6 per cent last month after a downwardly revised increase of 0.1 per cent in June, the Federal Reserve said on Friday. Economists polled by Reuters had looked for a gain of just 0.3 per cent last month.

The gain in output reflected a 0.8 per cent increase in factory production that was spurred by 10.6 per cent surge in motor vehicle output that more than offset a June decline.

Mining production edged up 0.2 per cent, while utilities production fell 1.0 per cent.

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The step up in overall production pushed the percentage of industrial capacity in use up to 78.0 per cent in July, in line with forecasts, from a downwardly revised 77.7 per cent in June.

Capacity utilization in the factory sector rose to 76.2 per cent last month, its highest level since December, from a revised 75.7 per cent in June.