U.S. industrial production rose in December, led by an increase in factory activity for a second consecutive month, the government reported Wednesday, suggesting that the manufacturing sector has rebounded and continues to expand at a moderate pace. The Federal Reserve (Fed) said industrial production rose 0.3 percent last month following 1 percent increase in November. The December gain was in line with economist expectations. Industrial production slowed last month mostly because output at utilities plunged 4.8 percent, reflecting unseasonably warm weather. Mining output gained 0.6 percent. Factory production, the biggest component of industrial production, increased 0.8 percent in December, following a 1.3 percent advance the previous month, which partly reflected a rebound from superstorm Sandy. Capacity utilization rose slightly to 78.8 percent last month. The two consecutive months of factory gains offered some hope that manufacturing could be accelerating after struggling through most of 2012. For the fourth quarter, industrial production rose at a 1.0 percent annual pace, but factory output increased at a weak 0.2 percent pace. Many factories have been hurt by a slowdown in consumer spending and weaker global growth that has reduced demand for U.S. exports.
