U.S. industrial production rose sharply in December despite slow growth in the manufacturing sector, its largest component.
Industrial production--a measure of output at factories, mines and utilities--rose a seasonally adjusted 0.9% in December from the prior month, the Federal Reserve said Wednesday.
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Economists surveyed by The Wall Street Journal had expected the index to rise 0.5%. November industrial production was revised to a 0.1% decline from an originally reported gain of 0.2%.
From a year earlier, industrial production rose 3.6% in December, the largest annual gain since 2010. In the fourth quarter as a whole, industrial production jumped 8.2% at an annual rate "after being held down in the third quarter by Hurricanes Harvey and Irma," the Fed said.
Wednesday's report showed output in the volatile mining sector increased 1.6% in December. The mining index, which includes oil and natural gas extraction, was up 11.5% from a year earlier. Utility output grew 5.6% from the prior month.
Manufacturing output, the biggest component of industrial production, edged up 0.1% in December. The December increase shows a pullback in growth from October and November, when output grew 1.5% and 0.3% respectively.
Capacity use, a measure of slack in the industrial economy, increased 0.7 percentage point to 77.9% in December. Economists had expected capacity utilization of 77.3% in December.
The longer-term trend in manufacturing has illustrated a pickup in the sector over the past year, due to a weaker dollar, more stable oil prices and global economic growth.
Industrial production was knocked off course in the third quarter, as hurricanes that battered the southern and eastern U.S. in the late summer caused refineries and plants on the Gulf Coast to shut down and stalled other keys parts of the manufacturing process.
The Federal Reserve's report on industrial production can be found at: https://www.federalreserve.gov/Releases/g17/current/default.htm.
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(END) Dow Jones Newswires
January 17, 2018 09:30 ET (14:30 GMT)