With an increase in manufacturing output offset by declines in mining and utilities output, the Federal Reserve released a report on Wednesday showing that U.S. industrial production unexpectedly came in unchanged in the month of January.
The report showed that industrial production was flat in January following an upwardly revised 1.0 percent increase in December. Economists had expected production to increase by 0.7 percent compared to the 0.4 percent growth originally reported for the previous month.
The Fed noted that the substantial upward revision to the December data reflected higher output for many manufacturing and mining industries.
The central bank said manufacturing rose by 0.7 percent in January following a 1.5 percent increase in December, with the continued growth largely to a 6.8 percent jump in motor vehicle output.
On the other hand, utilities output tumbled by 2.5 percent in January after slumping by 2.4 percent in the previous month. The decrease came as demand for heating was held down by temperatures that moved further above seasonal norms
The report also showed that mining output fell by 1.8 percent in January following a 0.9 percent increase in December.
Jennifer Lee, Senior Economist at BMO Capital Markets, said, "Although U.S. industrial (or 'lin-dustrial') activity cannot be described as lin-tastic at the start of the year, the details actually weren't that bad."
The Fed also said that capacity utilization edged down to 78.5 in January from a revised 78.6 percent in the previous month. Capacity utilization had been expected to rise to 78.6 percent from the 78.1 percent that had been reported for December.
Capacity utilization in the manufacturing sector rose to 77.0 percent in January from 76.5 in December, while capacity utilization in the mining and utilities sectors fell to 91.5 percent and 74.6 percent, respectively.
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