U.S. Manufacturing Jumps In November

Big Sector Gainers Included Utilities

U.S. Manufacturing Jumps In NovemberManufacturing output in the U.S. reached a nine-month high in November, easily beating the expectations of analysts. New data from the Federal Reserve shows U.S. manufacturing output increased 1.1% last month after an upwardly revised 0.4% rise in October. The consensus among economists was that the output would expand by about 0.5% in November, following a previously reported 0.2% gain a month earlier.

Big sector gainers included utilities, as a stretch of cold weather across the U.S. pushed November production up 5.1%. The jump in manufacturing and utilities helped lift overall industrial production higher by 1.3% in November, the largest monthly increase in more than four years. The rise was significant because it far surpassed output in October, which even revised upward only grew by 0.1%. It also widely outpaced global factory output, as manufacturing stagnated last month in places like China and Brazil.

Besides advances in utilities, U.S. auto production rose last month, too, growing by 5.1%. Motor vehicles sold in November at an annualized clip of 17.2 million, a 4.6% year-over-year increase that snapped a recent skid of sector declines. Output was strong, as well, in food, wood, plastics and rubber-based products.

According to Fed data, the amount of manufacturing capacity in use increased to 78.4% in November, up from 77.6% in October. Meanwhile, overall industrial capacity use rose to 80.1% last month, hitting its highest level since March of 2008. Capacity is among the measurements used by the Fed to determine the strength of the U.S. economy and the potential for inflation. So far, inflation has remained below the 2% target range set by Fed officials as they consider when to raise interest rates and normalize monetary policy. Another closely-watched metric is job creation. For 2014, U.S. manufacturers have added 165,000 jobs, contributing to a falling unemployment rate that now sits at 5.8%.