Hello and welcome to the details of US industrial production rebounds on end of auto strikes and now with the details
Nevin Al Sukari - Sana'a - Flags fly outside of Ford's Chicago Assembly Plant on October 26, 2023 in Chicago, Illinois. — AFP pic
WASHINGTON, Dec 15 — US industrial production returned to growth in November, with manufacturing output buoyed by a motor vehicle bounceback following the end of auto workers strikes, the Federal Reserve said today.
The United Auto Workers (UAW) union reached agreements to end its sprawling six-week strike in late October, after reaching deals with Detroit’s “Big Three” automakers over better pay and working conditions.
The new contracts, which were ratified a few weeks later, ensure that auto workers at Ford, General Motors and Stellantis will receive the most generous pay increases in decades.
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US industrial production rose by 0.2 per cent in November, up sharply from a revised decline of 0.9 per cent in October, the US central bank added in a statement.
This was in line with the market consensus, according to Briefing.com.
Manufacturing output rose 0.3 per cent, buoyed by a 7.1 per cent surge in motor vehicles and parts production, “following the resolution of strikes at several major automakers,” the Fed said.
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The rebound in motor vehicle production contributed to “most areas of strength,” the Fed said, pointing to a 7.5 per cent increase in the index for automotive products, and a 3.5 per cent gain in consumer durables.
Meanwhile, the production of nondurable consumer goods decreased 0.8 per cent, underscoring the ongoing challenges that producers face.
“Higher borrowing costs and weaker demand for goods are headwinds for manufacturing,” High Frequency Economics chief US economist Rubeela Farooqi wrote in a note to clients.
Pantheon Macroeconomics senior US economist Kieran Clancy added: “We continue to see little sign of any emerging rebound in the industrial sector.”
“Manufacturing activity is largely determined by the strength of domestic capital spending and external demand, both of which are depressed,” he wrote in an investor note. — AFP
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