US industrial production tumbles in Sep

US industrial production tumbled in September due to the lingering effects of Hurricane Ida and severe supply constraints, the Federal Reserve said.

Total industrial production fell 1.3 per cent in September, following a revised decline of 0.1 percent in August, Xinhua news agency quoted the Fed as saying on Monday.

The industrial production was previously reported to have risen 0.4 per cent in August.

Manufacturing output, which accounts for about 75 per cent of industrial production, fell 0.7 per cent last month, as the production of motor vehicles and parts fell 7.2 per cent due to shortages of semiconductors, according to the Fed.

“The lingering effects of Hurricane Ida more than accounted for the drop in mining in September; they also contributed 0.3 percentage point to the drop in manufacturing,” the Fed said.

It added that overall, about 0.6 percentage point of the drop in total industrial production resulted from the impact of the hurricane.

“Hurricane Ida made landfall on August 29, and was partially to blame for weakness” in the industrial production, Tim Quinlan and Shannon Seery, economists at Wells Fargo Securities, said in a statement on Monday, noting the storm limited oil and gas production in the Gulf of Mexico for the first half of September.

“But we cannot chalk up all of September’s weakness to Ida’s harsh effects. Relatively cooler weather caused utilities output to slide 3.6 per cent, and manufacturing continues to be limited by severe supply constraints.

“In short, the difficulty sourcing both product and labour is constraining output,” they added.