MNI BRIEF: US Dec Industrial Production Beats Expectations

U.S. industrial production in December rose 1.6% when markets had expected a gain of 0.5% and November's increase was revised a tenth higher to 0.5%, signaling strength in the manufacturing sector, the Federal Reserve reported Friday. Output in December was still 3.6% lower compared to a year earlier and was 3.3% below its pre-pandemic February level.

December capacity utilization rose to 74.5% when markets had expected only a slight increase to 73.6%. November capacity utilization was revised up by a tenth to 73.4%.

Manufacturing output rose for the eighth consecutive month in December, adding 0.9% following a 0.8% gain in November. The index for motor vehicles and parts was down 1.6%, but was still 3.6% higher than one year ago. Excluding vehicles, factory output was up 1.1%, with durable goods other than motor vehicles up 1.5% and nondurable goods production up 0.9%. Capacity utilization for manufacturing rose 0.7 point to 73.4%.

Utilities output was up 6.2%, rebounding from a 4.5% decline in November as demand for heating surged following an unseasonably warm November, the Fed said.