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Utilities Output Hampers US Industrial Production

A welder builds parts for finished petroleum tanks at Southern Tank and Manufacturing Inc. in Owensboro, Kentucky, U.S.
Ty Wright | Bloomberg | Getty Images
A welder builds parts for finished petroleum tanks at Southern Tank and Manufacturing Inc. in Owensboro, Kentucky, U.S.

U.S. industrial production was unchanged in May, the Federal Reserve said on Friday, compared with forecasts for a light increase after gains in manufacturing and mining were offset by a sharp drop in the output of utilities.

Analysts had expected a 0.2 percent rise in May industrial output following a revised 0.4 percent decline the previous month. Factory output rose 0.1 percent, matching expectations, while mining advanced 0.7 percent. But utilities output slumped by 1.8 percent.

(Click here to track the U.S. stock market reaction in premarket trade to this economic report.)

Industrial capacity utilization, a measure of how fully firms are deploying their resources, edged down to 77.6 percent from 77.7 percent in April, a rate that lies 2.6 percentage points below its estimated long-run average. Analysts had forecast capacity utilization to come in at 77.9 percent.

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