Washington, DC, April 15--Industrial production rose 0.3 percent in March, reflecting increased mining and utility output. Manufacturing produced fewer goods for the first time in six months.
The gain in overall production compared with a 0.2 percent increase in February, the Federal Reserve said today in Washington. The share of industrial capacity in use rose to 79.4 percent from 79.3, which was the highest since December 2000.
High energy prices, which helped boost overall production in March, are leading to a slowdown in manufacturing growth after its best year since 1999. Record gasoline prices helped restrain sales at retailers, a separate report showed this week.
"Higher energy costs are having an effect right now both on consumer and business sentiment," Elisabeth Denison, an economist at Dresdner Kleinwort Wasserstein in New York, said before the report. Production "is one of the areas we should see business caution, if there is any, as a result of higher energy prices."
That caution continues, according to a separate report from the Federal Reserve Bank of New York. Its so-called Empire Index of manufacturing in New York state expanded at the slowest pace in two years this month, the Bank said earlier today, registering 3.1, down from 20.2 in March.
Economists expected industrial production to rise 0.3 percent.
Factory production, which accounts for about 90 percent of the report, fell 0.1 percent, the first decline since September. Production increased 0.3 percent in February.
Manufacture of automotive products, including cars, slumped 3.6 percent after soaring 6.3 percent the month before. The drop came even as sales at auto dealerships and parts stores rose 0.7 percent, according to a government report released on April 13. Anticipating slower sales, Ford Motor Co. and General Motors Corp., the two biggest U.S. automakers, cut production forecasts for the first half of the year.
Production of all consumer goods, including autos, fell 0.1 percent after rising 0.5 percent in February. Makers of home electronic goods produced 1.9 percent less, after an increase of 8.3 percent the month before.
