Industrial production declined 0.3% in December, the third drop in the past four months, according to the U.S. Federal Reserve. Wall Street had anticipated the 0.3% decline. For the fourth quarter as a whole, industrial production declined at a 0.5% annual rate. Production retreated in three of the four quarters of 2019. Output was down 1.0% for the year.
Manufacturing output advanced 0.2% in December, but was down at a 1.0% rate for the fourth quarter. The increase in December came despite a 4.6% decline in output of motor vehicles and parts. Mining output rose 1.3% in December, while utility output declined 5.6% as warmer weather cut into the demand for home heating.
Capacity utilization dropped to 77% in December, the second lowest reading in 27 months. Capacity utilization remains below prerecession levels—above 80%—that economists say could fuel production costs and prices.