Factory Output In July Rises By Most Since March

WASHINGTON (AP) — A busy month for U.S. automakers lifted overall factory output in July by the most since the Japan crisis. A stronger manufacturing sector is the latest evidence that the economy may not be as weak as some had feared.

The Federal Reserve said Tuesday that factory output increased 0.6 percent last month. That's the biggest increase since the March 11 earthquake in Japan, which disrupted supply chains and limited output by some U.S. auto plants.

The resurgent auto industry accounted for nearly all of the increase in factory production. Motor vehicles and parts jumped 5.2 percent. Excluding that category, factory output grew only 0.2 percent.

Overall industrial production jumped 0.9 percent — the biggest increase this year. Unusually hot weather in July drove demand for energy generated by utilities. Mining output also increased.

Output by factories, mines and utilities has risen nearly 13 percent since a recession low in June 2009. But it remains about 6.5 percent below its pre-recession peak from September 2007.