March 16 (UPI) — U.S. manufacturing output fell 0.4 percent in February to mark the second consecutive month of decline, the Federal Reserve said Friday.
Manufacturing production declined amid drops in the production of motor vehicles, machinery and furniture industries, the Federal Reserve’s data showed. Figures were also revised to show factory output fell 0.5 percent in January instead of the 0.9 percent rate previously reported.
The report added that the materials, business supplies, and defense and space equipment sectors increased in production, while consumer goods, business equipment and construction supplies declined.
Manufacturing accounts for about 75 percent of all industrial production and 12 percent of the U.S. economy, and is losing the capital spending from the $1.5 trillion tax cut package of early 2018. A surge in the value of the dollar, which hurts exports, and the trade war between China and the United states, are also factors in the decline.
The severity of the slowdown seen in the Federal Reserve data was unexpected. Many economists anticipated a February increase in U.S. factory production.