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Factory output rises
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July 16, 1999: 10:50 a.m. ET
Jump of 0.2% in June was 5th in a row; capacity utilization rate slips
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NEW YORK (CNNfn) - U.S. industrial production rose for the fifth straight month during June, helping fuel the largest quarterly increase in output in one-and-a-half years.
The Federal Reserve Board reported Friday that U.S. factory, mine and utility output climbed 0.2 percent during June, mimicking a similar jump during May and on par with the increase expected among economists polled by Reuters.
That helped boost the overall second-quarter growth rate to 3.9, tripling the first quarter's 1.3 percent rise in output and marking the largest quarterly increase since a 6.6 percent gain posted during the fourth quarter of 1997.
The capacity utilization rate, measuring the amount of industrial capacity being used, fell slightly to 80.3 percent from 80.4 percent during May. That indicated factories, despite stepped up production, still have room to grow without experiencing the shortages that spark fears of inflation. Economists had expected that rate to remain steady.
Utilities, automobile parts lead growth
The only industry sector to experience a decline in output during the month was non-durable manufacturing, which saw production slide 0.2 percent amid weaknesses in most major categories, including farm equipment, civilian aircraft and industrial equipment.
Warmer weather helped the nation's utilities reverse a recent slide and post a 0.4 percent gain in production.
Manufacturing of durable goods climbed by a similar rate, although its 0.4 percent gain marked the smallest such increase since February. Much of the gain was driven by a 1.8 percent increase in the production of automobile parts. The production of other durable goods fell by a combined 0.5 percent.
Among major industries, the nation's utilities were the only sector to run at 90 percent or more of capacity during June.
Manufacturing capacity slid to 79.4 percent, which included the third straight decline in primary-processing manufacturing.
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Federal Reserve Board
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