After three months of sharp increases, U.S. industrial production growth was smaller than expected in August, according to a Federal Reserve report released Tuesday. Industrial production expanded by 0.4% on a monthly basis following July’s increase of 3.5% (revised from 3%), and is a sign that the economic recovery is starting to moderate. Analysts had called for an August increase of 1%.
While production increased for the fourth consecutive month, it remains 7.3% below its pre-pandemic February level, according to the Fed. Manufacturing output continued to improve in August, rising by 1%, although the Fed noted “the gains for most manufacturing industries have gradually slowed since June.” The increase in manufacturing output was partly offset by a sharp pullback in mining output, which plunged by 2.5% in August after jumping by 1.4% in July.