(Washington) US industrial production increased slightly in February, thanks to manufacturing and mining production which recovered after a decline in January which was due to weather conditions, according to data published Friday by the Federal Reserve (Fed).
On average, industrial production recorded a modest increase of 0.1%, after falling 0.5% in January.
Analysts anticipated stable industrial production, according to the Market Watch consensus.
In detail, manufacturing production climbs by 0.8%, and mining production by 2.2%, “partly reflecting, for both, a recovery after a decline (in January) linked to weather conditions”, details the Fed.
The index measuring the production of public utility services (water, electricity), however, fell by 7.5% due to higher than normal temperatures.
Industrial production is 0.2% lower than in February 2023.
The industrial capacity utilization rate remains stable at 78.3%, a rate 1.3% lower than its long-term average (between 1972 and 2023).
“The manufacturing sector continues to face challenges from rising borrowing costs and tighter credit conditions,” comments Rubeela Farooqi, chief economist at High Frequency Economics.
However, she believes that the Fed’s rate cut expected in the coming months, “as well as the relocation of supply networks, could support factory activity in 2024.”
Manufacturing activity in the highly industrialized region of New York, however, showed no sign of progress in March, and even deteriorated sharply, according to the monthly Empire State survey also published Friday by the regional branch of the Fed, and considered a good barometer of the American economy.
The index measuring this activity fell 19 points compared to February, falling to -20.9 points.
“Manufacturing activity fell significantly in New York State in March, with a drop in new orders, a sign of slowing demand. Labor market conditions remained weak as employment and hours worked declined,” commented Richard Deitz, economic research advisor at the New York Fed.