Auto, oil sectors drive June rebound in US industrial production
US industrial production rebounded in June as the oil and gas sectors rose and a key supply of auto parts recovered from a factory fire, the Federal Reserve reported Tuesday.
Factory output also rose for business equipment and consumer goods, offsetting losses in electricity generation and construction materials.
The result pointed to strong GDP growth in the second quarter, something economists widely expect after a sluggish first quarter.
Industrial production rose 0.6 percent for the month, a notch faster than analysts were expecting, meaning the quarter saw gains of six percent at an annual rate -- the third straight quarterly increase.
However, April was revised significantly downward, falling four tenths to a 0.5 percent decrease.
Ian Shepherdson of Pantheon Macroeconomics said the auto rebound was "noise," putting the pace of production well above the trend.
He added that he expected no further "sustained" increases in the quarterly growth rate.
"The uncertainty triggered by the administration's cavalier approach to trade policy has costs," he wrote in a research note.
The auto sector leapt eight percent after tumbling in May due to a fire at a plant producing truck parts. Excluding the auto sector, factory output grew by only 0.3 percent.
Elsewhere, manufacturers of wood products, consumer goods and electronics as well as aerospace manufacturers saw increases of one percent or more.
In its fifth monthly gain, the mining sector rose 1.2 percent, surpassing a record set in 2014. It was driven higher by recovering fuel prices. But utilities fell 1.5 percent on falling electricity generation.
Industrial capacity in use rose three tenths to 78 percent. Both manufacturing and utilities remained below their longer-run averages, however.
© 2018 AFP