Production at U.S. factories accelerated in July, boosted by a surge in motor vehicle output.
Manufacturing output increased by 1.4% in the month of July, according to the Fed Reserve report.
Economists polled by Reuters predicted a 0.6% increase in manufacturing production.
The production at auto plants reached 11.2% in the last month. The shortage of semiconductors was an issue faced by auto companies to adjust their production schedules.
The Fed noted, “A number of vehicle manufacturers trimmed or canceled their typical July shutdowns when they retool their plants.”
Manufacturing is being fostered by strong domestic demand, putting more strain on the supply chain and leaving manufacturers with shortages of labor and raw materials.
The surge in manufacturing output and a 1.2% rise in mining combined caused an increase in industrial production by 0.9% in July. At the same time, industrial output was increased 0.2% in June.
