Industrial output flat in March as manufacturing falls
WASHINGTON (Reuters) - Industrial output was flat for a second straight month in March, held back by a drop in manufacturing, according to a Federal Reserve report on Tuesday that suggested a cooling in factory activity.
Economists polled by Reuters had expected industrial production to increase 0.3 percent last month.
For the first quarter as a whole, industrial production rose at an annual rate of 5.4 percent, with manufacturing advancing at a 10.4 percent pace - the largest gain since the second quarter of 2010.
Last month, manufacturing activity was dragged down by a sharp decline in the production of nonmetallic mineral products. Auto production increased 0.6 percent after rising 0.8 percent in February.
Utilities output increased 1.5 percent after edging up 0.1 percent in February. Production at mines rose 0.2 percent after falling 4.0 percent the prior month.
Capacity utilization, a measure of how fully firms are using their resources, fell to 78.6 percent from 78.7 percent in February. That was 1.7 percentage points below its long run average.
Officials at the Fed tend to look at utilization measures as a signal of how much "slack" remains in the economy -- how far growth has room to run before it becomes inflationary.
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