US manufacturing output rose broadly last month and automobile production recorded its largest increase in five years, boosting the economy at the start of the third quarter.
While other data on Friday showed some cooling in factory activity in New York State this month, economists said it did not change their view that the economy was growing robustly, noting that the pullback followed a healthy increase last month.
“The broad-based nature of the [manufacturing] gains indicates that the strong second-quarter rebound in economic growth momentum is being sustained,” TD Securities deputy chief economist Millan Mulraine said in New York.
The US Federal Reserve said factory production jumped 1 percent last month after rising 0.3 percent in June. That was the largest gain since February and reflected increases across all major categories.
Auto production surged 10.1 percent, the biggest rise since July 2009.
There were also sturdy gains in the production of machinery, computers and electronic goods, which economists said hinted at a pick up in business investment this quarter.
A stronger pace of business investment is needed to ensure sustained economic growth.
The economy grew by a 4 percent annual pace in the second quarter and current forecasts put the growth rate for the third quarter within a range of 2.5 to 3 percent.
Industrial capacity utilization, a measure of how fully firms are using their resources, last month hit its highest level since February 2008.
The solid rise in manufacturing and a 0.3 percent advance in mining output helped to offset a 3.4 percent weather-driven decline in utilities production. That left overall industrial production up 0.4 percent last month.
The data had little impact on US financial markets, with traders focusing instead on events in Ukraine. The Ukrainian government said its forces had attacked and partly destroyed a Russian armored column that entered Ukrainian territory overnight.
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