Line workers spot weld parts of the frame on the flex line at Nissan Motor Co's automobile manufacturing plant in Smyrna, Tenn., on Aug. 23, 2018.U.S. manufacturing output fell for a second straight month in February and factory activity in New York state was weaker than expected this month, offering further evidence of a sharp slowdown in economic growth early in the first quarter.
The Fed said manufacturing production dropped 0.4 per cent last month, held down by declines in the output of motor vehicles, machinery and furniture. Data for January was revised up to show output at factories falling 0.5 per cent instead of slumping 0.9 per cent as previously reported.Economists polled by Reuters had forecast manufacturing output rising 0.3 per cent in February. Production at factories increased 1.0 per cent in February from a year ago.
February’s drop in manufacturing production added to soft reports ranging from retail sales to housing in suggesting the economy lost significant momentum early in the first quarter. Goldman Sachs is forecasting gross domestic product will rise at a 0.6 per cent annualized rate in the first quarter. The economy grew at a 2.6 per cent pace in the fourth quarter.In a separate report on Friday, the New York Fed said its general business conditions index fell 5.1 points to a reading of 3.
The Institute for Supply Management reported this month that its measure of national manufacturing activity dropped to more than a two-year low in February, with a sharp decline in the new orders component.Manufacturing is losing steam as the boost to capital spending from last year’s $1.5-trillion tax cut package fades.
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