WASHINGTON (Reuters) – U.S. manufacturing output rose in December, likely with output at Boeing Co rising after a strike by factory workers at the aerospace giant ended.
The Federal Reserve (US central bank) said on Friday that factory production increased 0.6% last month after an upwardly revised 0.4% rebound in November. Economists polled by Reuters had expected production to rise by 0.2%, after a 0.2% increase in previous reports.
Production at factories was unchanged year-on-year in December. It fell at an annual rate of 1.2% in the fourth quarter after shrinking at a pace of 0.8% in the July-September quarter. Manufacturing, which represents 10.3% of the economy, has largely stabilized in recent months after the US central bank began cutting interest rates.
The Institute for Supply Management’s Purchasing Managers’ Index rose to its highest level in nine months in December. But broad tariffs on imported goods planned by President-elect Donald Trump’s incoming administration could raise raw material costs and undermine any recovery.
Production of miscellaneous aerospace and transportation equipment jumped 6.3%. A strike by Boeing factory workers, which ended in November, reduced overall manufacturing output in September and October.
Production of automobiles and spare parts fell by 0.6% last month. Durable manufacturing output rose 0.4%, also supported by a 1.7% increase in primary metals production. Nondurable manufacturing output rose 0.7% amid broad-based gains.
Mining production advanced 1.8% after falling 0.5% in November.
Utility production rose 2.1%, driven by a 6.2% increase in natural gas production amid freezing temperatures. This followed a 0.7% decline in November.
Industrial production accelerated 0.9% last month, with aircraft and spare parts production contributing 0.2 percentage points, after rising 0.2% in November. It rose 0.5% year-on-year in December and shrank at a 0.8% pace in the fourth quarter after shrinking at a 0.6% pace in the July-September quarter.
The capacity utilization rate in the industrial sector, a measure of how fully companies are using their resources, rose to 77.6% from 77.0% in November. It is 2.1 percentage points lower than its average over the period 1972-2023. The employment rate for the manufacturing sector rose 0.4 percentage points in December to 76.6. It is 1.7 percentage points lower than its long-term average.
(Reporting by Lucia Mutikani)
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