Output at American factories, mines and utilities jumped by a significant 0.8 percent in June, nearly doubling analysts' expectations, the Federal Reserve reported Monday. The industrial production figures suggested broad advances in manufacturing, mining and auto production, despite fears of an economy stifled by inflation. The June gain followed a gain of only 0.1 percent in May. The increase in June put U.S. industry operating at 82.4 percent of capacity, up from a May operating rate of 81.8 percent of capacity. Production of autos and auto parts rose a robust 3.3 percent in June, mining production rose 1.2 percent in June and manufacturing gained 0.7 percent from the previous month, the Federal Reserve figures showed. June also included a 1.7 percent rise in output of oil and natural gas. Economists believe that U.S. manufacturing will slow in coming months as the higher costs of energy combine with higher national interest rates to slow overall economic growth. Today's numbers suggest the economy may still not be slowing quickly enough, fueling concern that the Federal Reserve may continue to increase its overnight lending rates. U.S. stock markets moved lower in early morning trading after the report was released.
