US industrial production drops a little more than expected

US industrial production fell a touch more than expected in August, according to the latest data from the Federal Reserve.

Industrial output was down 0.4% after rising a revised 0.6% in July. Economists had been expecting a 0.2% decline.

Manufacturing output was also down 0.4% in August, reversing its increase in July, while the index for utilities fell back 1.4%.

The output of mining moved up 1% in August, which was its fourth consecutive monthly increase following an extended downturn. Still, the index was about 9% below its year-ago level.

On the year, industrial production was down 1.1%.

Meanwhile, capacity utilisation, which measures industrial slack, nudged down to 75.5% from 75.9% in July.

Capital Economics said: "That fall in manufacturing output wasn’t a huge surprise given the already-reported decline in total employee hours worked, as well as the renewed slump in the ISM manufacturing index back below the 50 mark in August.

"Indeed, despite the strong gains in June and July suggesting that the sector was starting to recover from the dollar’s prior appreciation, it appears that manufacturing activity is still struggling to make any headway."