US industrial production eked out a 0.1% gain in August after falling 0.4% in July, the Federal Reserve reported on Tuesday.
The modest rise reflected a recovery in manufacturing and mining activity, though weakness in utilities limited overall growth.
At 103.9% of its 2017 average, the industrial production index stood 0.9% higher than in August last year.
Capacity utilization remained at 77.4%, unchanged from July and 2.2 percentage points below its long-run average dating back to 1972.
Autos lift manufacturing output
Manufacturing output rose 0.2% in August, building on a relatively soft performance in July when it slipped 0.1%.
The motor vehicles and parts sector drove much of the increase, posting a sharp 2.6% rise as automakers ramped up production.
Factory output excluding vehicles edged only 0.1% higher, pointing to uneven conditions across industries.
Durable goods manufacturing increased 0.2%, with strength in autos offsetting declines in fabricated metals and machinery.
The nondurable segment improved by 0.3% following a July decline, supported by robust gains in textiles and petroleum products.
Plastics and rubber, however, contracted by 0.7%, while chemicals and food-related industries managed smaller increases of 0.3% and 0.2%.
Overall, manufacturing output was 0.9% above its year-earlier level, underscoring a gradual but inconsistent recovery.
Mining improves while utilities drag
Mining output rebounded 0.9% in August after a 1.5% decline in July, with capacity utilization in the sector rising to 90.6%, more than four percentage points above its long-run average.
The rebound highlights resilience in extractive industries despite broader economic uncertainty.
In contrast, utilities posted a 2% decline, led by a 2.3% drop in electric power generation.
Natural gas utilities edged higher by 0.2% but were not enough to offset the pullback in electricity demand.
Utility operating rates slipped to 68.6%, well below their long-term average.
Market group performance remains uneven
Performance across market groups highlighted the sector’s mixed picture.
Consumer durables climbed 0.6%, largely due to the strength of automotive products, while nondurables rose 0.3%.
Business equipment output slipped 0.1% as weakness in industrial machinery outweighed gains in transit and information processing equipment.
Construction supplies advanced 0.6%, while business supplies fell 0.4%. Materials output edged up just 0.1%, suggesting a tentative recovery in input demand.
Outlook tempered by weak capacity use
The August report suggests industrial production is stabilizing following July’s setback, but momentum remains modest.
Stronger auto output and a rebound in mining offered support, yet subdued demand for utilities and machinery underscores lingering headwinds.
With capacity utilization stuck below its long-run average, analysts say the sector faces challenges in building sustained momentum.
Economists expect production to continue improving gradually, though risks from weaker global demand and tariff-related price pressures could weigh on the outlook in coming months.
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