The numbers: U.S. industrial production was flat in February, the Federal Reserve reported Friday.
The unchanged reading was in line with economists expectations, according to a survey by The Wall Street Journal.
Output rose a revised 0.3% in January, revised up from the initial estimate of a flat reading, but there were deep declines in November and December.
Capacity utilization held steady at 78% in February. It is down from a high of 80.2% reached last April.
Key details: Manufacturing output downshifted to a slim 0.1% rise in February after a strong 1% gain in the prior month.
Motor vehicles and parts output fell 0.3% after a 0.6% jump in January. This is the first decline in the last four months. Excluding autos, total industrial output was unchanged.
Utilities output rose 0.5% in February on demand for heating. Mining output, which includes oil and natural gas, fell 0.6% after a 2% gain in the prior month.
Big picture: Industrial production is on a weak trajectory, economists said.The softness in manufacturing is expected to continue as interest rates have moved higher. Credit conditions are expected to tighten in the wake of the worries surrounding regional banks.
What are they saying? “With the surveys going from bad to worse and given the risks from the turmoil in the banking sector, we suspect that further declines in manufacturing activity still lie in store,” said Andrew Hunter, deputy chief economist at Capital Economics.
Market reaction: Stocks
were lower on Friday on continued concern about the banking sector. The yield on the 10-year Treasury note
fell to 3.47%.