Economists polled by Reuters had predicted manufacturing output would increase by 0.4%
Production at US factories slowed more than expected in August, amid disruption from Hurricane Ida and shortages of raw materials and labs due to the COVID-19 pandemic.
Manufacturing output rose 0.2% last month, the Federal Reserve said on Sept. 15. The July figures were revised so that production would increase by 1.6% instead of 1.4%, as previously reported.
Economists polled by Reuters had estimated manufacturing output would increase by 0.4%.
Raw material shortages have been worsened by congestion at ports in China, along with the latest wave of infections driven mainly by the delta version of the coronavirus in Southeast Asia.
General Motors Co. said this month it would cut production at its plants in Indiana, Missouri and Tennessee due to microchip shortages. Ford Motor Company is also reducing truck production.
Some of the slowdown in manufacturing reflects a rotation in spending back from goods to services due to the COVID-19 vaccination. Manufacturing, which accounts for 11.9% of the US economy, has been undermined by businesses desperate to replenish stocks after a sharp decline in inventory in the first half of the year.
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