U.S. industrial production was up 1 percent in September versus expectations of 0.4 percent, the biggest gain in nearly two years as factory activity quickened and utilities output logged a big-weather related jump, a welcome sign on the pace of the economy’s recovery.
Output at the nation’s mines, factories and utilities increased 1.0 percent after slipping 0.2 percent in August, the Federal Reserve said on Thursday. It was the biggest rise since November 2012 and handily outstripped the 0.4 percent gain expected on Wall Street.
With activity quickening, the amount of productive capacity in use rose to 79.3 percent, the highest level since June 2008. The Fed keeps an eyes on capacity use for signs inflationary bottlenecks may be developing. Despite the latest jump, the figure still remains 0.8 percentage point below its long-run average.
Manufacturing production, which had dropped 0.5 percent in August, advanced by 0.5 percent in September with widespread gains across subsectors. Economists polled by Reuters had expected a gain of just 0.3 percent.
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