U.S. industry shows muscle in late 2013
By Lucia Mutikani
WASHINGTON (Reuters) - U.S. industrial output rose at its fastest clip in 3-1/2 years in the fourth quarter as factory activity closed out the year on a strong note, a sign of the economy's brightening prospects.
Manufacturing production rose a stronger-than-expected 0.4 percent in December after an out-sized 1.0 percent increase the prior month, a Federal Reserve report on Friday showed.
That helped push overall output at the nation's factories, mines and utilities up 0.3 percent last month. Economists polled by Reuters had expected factory output to rise 0.3 percent, while the gain in overall industrial production matched forecasts.
"It adds to the evidence that the fourth quarter was a good one," Gus Faucher, a senior economist at PNC Financial Services in Pittsburgh. "It also provides further evidence that the slowdown in employment growth in December was a fluke."
For the fourth quarter as a whole, industrial production advanced at a 6.8 percent pace, the largest quarterly increase since the second quarter of 2010.
Fourth-quarter growth is shaping up to be far stronger than economists had anticipated, with estimates ranging as high as a 3.9 percent annual rate. But that does not seem to have inspired U.S. households.
A separate report showed the Thomson Reuters/University of Michigan's preliminary reading on the overall index on consumer sentiment slipped to 80.4 early this month from 82.5 in December.
Job growth slowed sharply in December, largely blamed on cold weather that blanketed large parts of the country. At the same time, incomes barely grew, sapping household morale. Continued...