Industrial Production Rose in February

As reported by Bloomberg;

Industrial production unexpectedly rose in February, due in part to gains in demand for computers and semiconductors that signal the pickup in U.S. business investment is being sustained.Output climbed 0.1 percent, the eighth consecutive increase, as utility use and mining increased, figures from the Federal Reserve showed today in Washington. Businesses are stabilizing inventories and buying equipment in a bid to meet growing global demand.


Capacity utilization, or the proportion of plants in use, climbed to 72.7 percent from 72.5 percent, today’s Fed production report showed. The gauge averaged 80 percent over the past two decades and suggests inflation will remain low.Manufacturing output declined 0.2 percent after increasing 0.9 percent in January, the report showed. “Production was likely held down somewhat by winter storms in the Northeast,” the Fed said in the release.

Production of business equipment increased 0.4 percent, a third consecutive gain, as demand for computers, communications gear and semiconductors climbed, a sign business investment is picking up. Spending on equipment and software climbed at an 18 percent annual rate in the fourth quarter, the most since 2000, the Commerce Department said Feb. 26. Some companies are upgrading their sales forecasts.