Storm Sandy depresses U.S. industrial output in October

U.S. industrial output unexpectedly fell in October as superstorm Sandy disrupted production, but the underlying tone remained consistent with slowing manufacturing activity.
   
Industrial production contracted 0.4 percent last month after a revised 0.2 percent increase in September, the Federal Reserve said on Friday.
   
The Fed said the storm, which tore through the East Coast at the end of October, is estimated to have reduced the rate of change in output by nearly 1 percentage point. It reduced the output of utilities, chemicals, food, transportation equipment and computers and electronic products, the Fed said.
   
Economists polled by Reuters had expected a 0.2 percent gain in industrial output last month after September's previously reported 0.4 percent increase.
   
Last month, utilities output fell 0.1 percent after being flat in September. Even accounting for the storm, which is estimated to have caused $50 billion in damage, the general tone of the report was weak.
   
Manufacturing production fell 0.9 percent as motor vehicle output declined for a third straight month. Manufacturing had gained 0.1 percent in September.
    
Excluding the effects of the storm, manufacturing output was little changed from its September level, the Fed said. In addition, the factory operating rate slipped to 75.9 percent in October, 2.9 percentage points below its long-run average.
   
Production at mines increased 1.5 percent after rising 0.9 percent the prior month.


REUTERS