U.S. industrial output unexpectedly fell in January as a return to normal winter temperatures caused a sharp fall in utility output, while production from mines also fell, a Federal Reserve report showed on Wednesday.
Industrial production fell 0.1% in January after an upwardly revised 1.2% jump in December, which had been driven by unseasonably cold weather that spiked heating demand.
Continue Reading Below
The drop was the first decline in output since June 2009 and was well below the median forecast for a 0.5% increase in a Reuters poll of economists after December's originally reported 0.8% gain.
Utility output fell by 1.6% in January after a 4.1% leap in December, while mining output fell 0.7%.
Manufacturing output in January grew just 0.3% after an upwardly revised 0.9% gain in December.
Capacity use, a measure of how fully firms are using their resources, dipped to 76.1% from an upwardly revised 76.2%. Economists polled by Reuters had predicted a 76.3% capacity use rate.
Officials at the Fed tend to look at utilization measures as a signal of how much "slack" remains in the economy—how far growth has room to run before it becomes inflationary.