US production has fallen unexpectedly in September for the first time in a year, indicating that the sector that assisted economic recovery is cooling. Economists had predicted that production would go up 0.2%. The drop came after an unrevised 0.2% rise in August.
Output at US factories, utilities and mines fell 0.2%, the first drop since the end of the recession in June 2009, data from the Federal Reserve revealed today. Factory production also declined 0.2%, showing declines in consumer durables such as furniture and appliances.
Commenting on the latest figures, chief economist at New York's UniCredit Group, Harm Bandholz, said, "It doesn’t mean we’ll see a lot more negative numbers, but the growth rates will be lower over the next few months", while adding, "The inventory cycle is losing momentum and the pickup in global growth has also started to slow down".
Stocks didn't change much, supported by Citigroup's earnings that surpassed analysts' predictions as securities went up and loan loss reserves decline. The Standard & Poor’s 500 Index went up by 0.1% to 1,177.29.
Another
report showed today that demand in the global market for US bonds,
stocks and other financial assets went up in August as Treasuries were
bought by investors anticipating that the Federal Reserve will ease
monetary policy. Net purchases of long-term securities equalled 128.7 billion dollars in August against net purchases of 61.2 billion dollars in July, figures from the Treasury Department revealed.
