US factories, power plants and mines increased production by a steeper than expected 0.7 per cent in January, the Federal Reserve today.
The increase was the sharpest in six months, and about twice as large as had been forecast by Wall Street economists.
Manufacturing output rose 0.5 per cent, largely because of higher automobile production. Utility output shot up 4.0 per cent, boosted by winter heating demand. Mining production fell 1 per cent.
"The strong increase in January 2003 industrial production confirms that the industrial sector is rebounding from the decline in industrial activity during fourth quarter 2002," said Manufacturers' Alliance chief economist Mr Daniel Meckstroth.
"A key reason for the strong growth was that the saw-toothed pattern of motor vehicle production spiked in January," he said.
"Nevertheless, a positive turn in business equipment production and further growth in high tech information processing equipment contributed to the greater than expected gain."
A breakdown of the manufacturing sector showed motor vehicle and parts production surged 4.9 per cent in January, reversing a 5.3 per cent slump in December.
Production of final products rose 1 per cent, as factories pushed up output of consumer goods by 1 per cent and of business equipment by 1 per cent.
AFP