Industrial production slows down
Published: Saturday, January 17, 2004 at 6:01 a.m.
Last Modified: Saturday, January 17, 2004 at 1:09 a.m.
WASHINGTON - Industrial production at the nation's factories, mines and utilities rose by only 0.1 percent in December, slowing from the previous month's big increase.
The gain reported by the Federal Reserve Friday followed a revised 1 percent November jump, stronger than previously estimated and the biggest in four years.
Economists were expecting industrial production to cool off a bit in December given November's brisk activity. Analysts were calling for a 0.5 percent increase. Still, with December's gain, it marked the fourth straight month that production expanded.
Earlier this week, the Fed, in a more forward-looking survey of business conditions around the country, found the economy was gaining momentum as the new year began. The Fed reported growing signs that the nation's battered manufacturing sector was beginning to pull out of its nosedive.
In Friday's report, production at factories - the biggest chunk of industrial activity tracked by the Fed - rose by a modest 0.3 percent in December, down from a 1 percent gain the previous month. Output at mines was flat, following a 0.6 percent increase in November. Production at utilities sank by 1.4 percent, erasing the same-sized gain the month before.
``When you put all the data together it shows that a moderate manufacturing recovery is sustainable and is continuing,'' said Clifford Waldman, economist at the Manufacturers Alliance/MAPI, a research group.
The Dow Jones industrials gained 46.66 points to close at 10,600.51, the highest close since March 19, 2002.
In other reports, consumer confidence soared in January to its highest level in three years, lifted in part by the stock market's turnaround. A preliminary reading of the University of Michigan's index of consumer sentiment showed a jump to 103.2 from a reading of 92.6 in December.
The Commerce Department reported that America's businesses boosted their stockpiles by a modest 0.3 percent in November, a sign that companies are betting the rebound will be lasting. Businesses' sales went up by 0.5 percent.
Inventory building adds to economic growth, as measured by the gross domestic product.
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