US factories have been hit by extreme weather – but there’s no need to worry
Industrial production in the US is the latest economic release to take a hit from the dreadful weather the country’s been experiencing.
Production fell 0.3 per cent in January, according to figures from the Federal Reserve – it was expected to increase 0.3 per cent.
Manufacturing output dropped 0.8 per cent as the severe weather stopped employees reaching factories. And mining fell 0.9 per cent – again, inhibited by the weather.
But with households cranking up the heating, utilities jumped 4.1 per cent. This, says Paul Dales of Capital Economics, will boost consumption and help compensate for January’s weak retail sales (released yesterday).
Dales stresses that there’s no need to be concerned by the figures, though.
Although the bad weather’s continued into February, production will bounce back as postponed orders are completed. He says: “After all, the fundamentals have not changed… The outlooks for the domestic and global economies are still better than for some time.”