WASHINGTON--U.S. industrial production rose for the first time in three months in June on the back of higher utility output, but manufacturing remained flat, the Federal Reserve reported Wednesday.
Industrial output increased 0.3% in June, after declines of 0.2 percent and 0.5 percent in May and April, respectively.
The June pick-up in overall industrial production was driven by utilities, such as water and electricity, which rose 1.2%, and mining, up 1.0%.
Manufacturing, accounting for about three quarters of total industrial output, has been under pressure from tepid consumer spending and a stronger dollar weighing on exports. It was unchanged for a second straight month in June.
"The industrial production gains in June were the result of changes in prices and unusual temperature trends, not a change in demand for US manufacturing goods," said Briefing.com in a research note.
Barclays analyst Jesse Hurwitz highlighted that with the June data, the second-quarter growth rate of total industrial output fell 1.4%, following a 0.1% gain in the first quarter, in the first quarterly contraction since the recession ended in June 2009.
"We continue to view this downturn as driven by the impact of a stronger dollar and cutbacks in the energy sector from the decline in oil (prices)," Hurwitz said in a client note.
"Looking ahead, we expect output for the sector to stabilize, but do not see a robust expansion as likely over the next few months."
Copyright Agence France-Presse, 2015
