U.S. industrial output surges in June, boosted by autos

Louisville Assembly Plant employees work to assemble the new 2013 Ford Escape on the production line in Louisville, Kentucky, June 13, 2012. REUTERS/John Sommers II/File Photo

WASHINGTON, July 15 (Reuters) - U.S. industrial production

rose more than expected in June on large gains in automotive

manufacturing and utility output, the Federal Reserve said on

Friday, a sign that the economy was regaining momentum at the

end of the second quarter.

Industrial output increased 0.6 percent last month, the

strongest gain since July 2015, after an upwardly revised 0.3

percent decline in May.

Economists polled by Reuters had forecast industrial

production rising 0.2 percent last month.

The industrial sector measured by the U.S. central bank

comprises manufacturing, mining, and electric and gas utilities.

It has shown halting signs of improvement after a downturn

over the past 18 months caused by weak global demand, a strong

dollar and the fall in oil prices.

In June, however, manufacturing output rose 0.4 percent

after an upwardly revised 0.3 percent fall in May, while

production of consumer goods rose 1.1 percent.

Output of automotive products jumped 5.9 percent, while

machinery output was up 1.1 percent, the Fed said. Output of

computers, electronics and appliances increased 1.5 percent.

Business equipment production in June rose 0.7 percent after

a 0.3 percent fall in May. The Fed has become increasingly

worried about soft business investment.

The index for utilities rose 2.4 percent after a 0.9 percent

drop in May, while mining output rose 0.2 percent, a slight

softening from its May increase of 0.3 percent.

With overall output up, the percentage of industrial

capacity in use rose to 75.4 percent in June from an unrevised

74.9 percent in May.

The Fed sees capacity use as a leading indicator in deciding

how much further the economy can grow before sparking higher


(Reporting by David Lawder; Editing by Paul Simao)

((David.Lawder@tr.com; +1 202 354 5854; Reuters Messaging: