WASHINGTON – U.S. factory production fell in March after companies made fewer electronic products, steel and other metals. But the decline followed three months of strong manufacturing gains.
The Federal Reserve said Tuesday factory production dropped 0.2 percent last month. Still, for the first three months of this year, manufacturing output rose at an annual rate of 10.4 percent. The gain was led by a nearly 40 percent in increase production of motor vehicles and parts.
Overall industrial production was flat in March, the second straight month of no gain. A 1.5 percent jump in output at utilities was offset by weakness in manufacturing. Output at the nations mines edged up 0.2 percent.
Economists downplayed the March dip in manufacturing, noting that February factory output was revised up from an initial estimate of 0.3 percent to a 0.8 percent increase.
The slowdown in manufacturing is something to watch but given how fast production had been growing, a pause that refreshes is not a surprise, said Joel Naroff, chief economist at Naroff Economic Advisors.
Manufacturing represents the largest segment of industrial production. It has risen 18 percent from its recession low in June 2009 and remains just 6.4 percent below its pre-recession peak, reached in December 2007.
In recent months, factories are benefiting from rising consumer confidence and a better job market.
Retail sales rose 0.8 percent in March, the Commerce Department said Monday.