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US industry output dips most in 3 years

Friday, September 14 14:59:07

U.S. industrial output fell in August by the most in over three years as production slowed in factories and a hurricane temporarily shut down oil and natural gas rigs in the Gulf of Mexico.

Industrial production fell 1.2 percent, the Federal Reserve said today. That was the steepest decline since March 2009. Analysts polled by Reuters had expected industrial output to be flat last month.

In March 2009, when the U.S. economy was still languishing in recession, industrial output declined by 1.7 percent.

The decline was driven by a 0.7 percent drop in factory output, a sign that the cooling global economy appears to be holding back growth in America's manufacturing sector.

The Fed estimated that Hurricane Isaac, which hit the Gulf Coast last month, contributed about 0.3 percentage point to the overall fall in output.

The storm dragged on mining output, which declined by 1.8 percent in August.

Industrial production encompasses output from factories, utilities and mining operations, including oil and natural gas production.

Utilities output declined 3.6 percent in August. (C ) Reuters