U.S. manufacturing production rises more than expected in November

WASHINGTON (Reuters) - U.S. manufacturing output rebounded more than expected in November, as the end of an almost six-week strike at General Motors plants boosted auto production.

FILE PHOTO: An employee works on the sealer line in the paint department during a tour of an automobile plant in Marysville, Ohio October 11, 2012. REUTERS/Paul Vernon/File Photo

The Federal Reserve said on Tuesday that manufacturing production rose 1.1% last month after a downwardly revised 0.7% fall in October. Industrial output also rose 1.1% in November after a downwardly revised drop of 0.9% in October.

Excluding motor vehicles and parts, overall industrial production and manufacturing output in November rose 0.5% and 0.3% respectively.

Economists polled by Reuters had forecast overall manufacturing output would rise 0.7% and industrial output would increase 0.8% in November. Production at factories still fell 0.8% in November on a year-on-year basis.

The United Auto Workers union reached a new four-year labor contract with General Motors GM.N in late October, ending a strike by about 46,000 workers with the No. 1 U.S. automaker.

The Fed’s measure of the industrial sector comprises manufacturing, mining, and electric and gas utilities.

There was a 12.4% jump in the production of motor vehicles and parts in November. Overall, production rose 2.1% for consumer goods and 1.7% for business equipment, the Fed said. Utilities output increased 2.9% compared to a decline of 2.4% in the previous month.

The manufacturing sector, which makes up about 11% of the U.S. economy, has been weakened by a 17-month trade war between the United States and China.

Last Friday, the world’s two largest economies announced a “Phase one” agreement that reduces some U.S. tariffs in exchange for increased Chinese purchases of American farm goods.

With overall industrial output rising, capacity utilization, a measure of how fully firms are using their resources, increased 0.7 percentage point to 77.3% in November from a downwardly revised 76.6% in October.

Reporting by Lindsay Dunsmuir; Editing by Paul Simao