U.S. Economy: Industrial Production Contracts at Slower Pace

Industrial production contracted the least since October last month and New York’s manufacturing slump eased further in May, signaling the recession’s grip is loosening.

Output at U.S. factories, mines and utilities decreased 0.5 percent last month, less than forecast, after dropping 1.7 percent in March, Federal Reserve figures showed today in Washington. The New York Fed’s Empire state manufacturing index rose to minus 4.6, also beating economists’ estimates.

Today’s figures signal that manufacturing is bottoming out after companies slashed their stockpiles of unsold goods the most on record in the first three months of the year. Continued weakness in consumer spending means demand is too low for firms to raise prices: government figures today showed the consumer price index was unchanged in April after a March drop.

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- Posted: 2009-05-15 10:32:35

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