US industrial output edges higher | |
The output of US factories, mines and power plants rose by 0.2% in July, driven by a 3.6% rise in the production of motor vehicles compared with June. The growth was faster than had been expected, but slower than the previous month, when output grew by 0.4%. While manufacturing performed well in July, the output of electricity and gas plants fell by 1.9% after a strong increase the previous month. The US housing housing slump also resulted in lower furniture production. Analysts said the rise in vehicle production and parts last month was more to do with the reopening of a major parts plant after a strike, rather than a recovery of the industry. With disposable income being squeezed, sales of cars and trucks have fallen significantly. The figures reflected this, with automotive production in July 10.4% lower than a year earlier. Falling fuel prices Elsewhere, there was slightly more positive news on the consumer front. A survey by the University of Michigan showed consumer confidence had edged up slightly in August. Economists put this down to the fall in fuel prices, which have declined since crude oil reached a record high at the end of July. However, they cautioned that a rise in confidence may not necessarily mean consumers are going to spend more. "The outlook for consumers is still not good," said economist Richard Dekaser from National City bank. "The past month has been good but we are hardly out the woods. The labour market is still very weak. We had job losses every month this year. Wealth is also falling." | |
