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(Bloomberg) — US industrial output declined in July by the most since the start of the year on a pullback in factory production that included a Hurricane Beryl-related decrease in Gulf Coast refinery activity.
The 0.6% decrease in production at factories, mines and utilities followed a downwardly revised 0.3% advance a month earlier, Federal Reserve data showed Thursday. The median estimate of Bloomberg survey of economists called for a 0.3% decrease.
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Manufacturing production fell 0.3%, while mining and energy extraction was unchanged. Output at utilities decreased 3.7%.
Factory output was disrupted after Beryl struck eastern Texas early in the month and caused a massive power outage for millions of homes and businesses.
The Fed said that the hurricane prompted facility closures and reduced the output of natural gas extraction. Beryl was estimated to have held down overall factory output by 0.3%, while a drop in motor vehicle production restrained it by 0.6%.
Excluding auto output, factory production increased 0.3% in July after no change in the prior month.
Manufacturing, which accounts for three-fourths of total industrial production, has struggled as the Fed has kept interest rates higher for longer. Factory surveys have been more downbeat.
Separate data out Thursday showed manufacturing in New York state shrank for a ninth straight month, while activity in the Philadelphia Fed region contracted for the first time since January.
Within materials, the Fed’s data showed output of energy and chemicals both slid 1.1%. Production of business equipment declined for a second month, while output of construction and business supplies eased.
Meanwhile, capacity utilization at factories, a measure of potential output being used, fell to 77.2% from 77.5%. The overall industrial utilization rate also declined, to 77.8%.
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