A report released by the Federal Reserve on Thursday showed a significant rebound in U.S. industrial production in the month of October.
The Fed said industrial production jumped by 1.1 percent in October after falling by a revised 0.4 percent in September.
Economists had expected production to surge up by 1.0 percent compared to the 0.6 percent drop originally reported for the previous month.
The rebound in production came as manufacturing output shot up by 1.0 percent in October after inching up by 0.1 percent in September.
The report also showed utilities output spiked by 3.9 percent in October after plunging by 5.2 percent in the previous month.
On the other hand, the Fed said mining output fell by 0.6 percent in October following a 1.2 percent jump in September.
The Fed noted industrial production has recovered much of its 16.5 percent decline from February to April, but output in October was still 5.6 percent lower than its pre-pandemic February level.
“Industrial activity is settling into a slower pace of expansion following the burst of activity unleashed by the release of pent-up demand and a sugar rush from significant fiscal support,” said Oren Klachkin, Lead U.S. Economist at Oxford Economics.
He added, “Looking ahead, we expect industrial activity to continue recovering its pandemic-induced losses, but growth will be slower compared to the summer months.”
The report also showed capacity utilization in the industrial sector rose to 72.8 percent in October from an upwardly revised 72.0 percent in September.
Economists had expected capacity utilization to climb to 72.3 percent from the 71.5 percent originally reported for the previous month.
Capacity utilization in the manufacturing and utilities sectors rose to 71.7 percent and 72.7 percent, respectively, while capacity utilization in the mining sector edged down to 77.9 percent.
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