US industrial production bounces back after strike action in auto sector

Industrial production in the US bounced back sharply last month, led by that of motor vehicles and parts, as activity in the sector recovered from two months of strike action by unions.

According to the Department of Commerce, total industrial output rebounded at a month-on-month clip of 1.1%, putting the year-on-year rate of increase at -0.8%.

Factory output climbed at a month-on-month pace of 1.1% following two consecutive monthly declines of 0.7%, but remained 0.8% lower on the year.

Nonetheless, production of motor vehicles and parts soared by 12.4% on the month.

Output from mining meanwhile dipped 0.2% and that from utlities was 2.9% higher.

By market groups, Production of final products rose by 1.8% versus October, with that of consumer goods rising by 2.1% and that of business equipment by 1.7%.

In parallel, the output of non-industrial supplies increased by 0.4% and that of materials by 0.7%.

The rate of industrial capacity utilisation increased from 76.6% in October to 77.3% for November (consensus: 77.4%).

"Excluding autos, underlying manufacturing output rose by 0.3% m/m, the first increase in three months," said Michael Pearce, senior US economist at Capital Economics.

"Output still looks set to fall in the fourth quarter overall, but with the global backdrop stabilising, trade tensions easing and the dollar no longer appreciating, prospects for the industrial sector look set to brighten a touch in 2020."