US industrial production clocks third straight month of gains
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US industrial production grew for a third straight month in April, boosted by strong output gains in utilities and the oil and gas sectors.
Industrial production — which measures output at factories, mines and utilities — rose 0.7 per cent in last month, according to data from the Federal Reserve. That’s better than the 0.6 per cent rise analysts had expected and comes as the increase for March was revised upwards from 0.5 per cent to 0.7 per cent.
Mining output climbed 1.1 per cent, mostly reflecting strong gains in oil and gas extraction as US shale producers ramped up production in response to higher oil prices. This marks the third consecutive month of gains for the mining index, which is now 10.6 per cent higher than its year ago level.
Utilities output rose 1.9 per cent as an unusually cold April drove up demand for home heating.
Manufacturing remains a weak spot. Hurt perhaps by concerns over escalating US-China trade tension, manufacturing output rose only 0.5 per cent last month. While that’s better than the flat reading in March, it is a slowdown from the 1.4 per cent jump recorded in February.
The reading on industrial production comes as Fed officials continue to deliberate on the appropriate pace of interest rate increases for this year. Solid retail sales and a pick-up in inflation have prompted the market to step up their expectations that the central bank would step up the number of rate rises from three to four this year.
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