US factory production increased in February due to rise in auto output

In February, US manufacturing output rose by 0.9%. A month earlier, the figure stood at 0.1%, according to the Federal Reserve System (Fed).

The increase occurred despite the uncertainty stemming from US President Donald Trump's trade policies. However, as Wells Fargo economists note, it is premature to interpret this uptick as a sustained upward trend. Caution is advised regarding the sector's recovery prospects until the concerns surrounding US import tariffs ease.

According to the Fed, the February increase was driven by a rise in auto output. Due to the 25% tariffs on products from Canada and Mexico, US companies have ramped up vehicle production to its highest levels. This has resulted in an increase in inventories.

Excluding the automotive sector, production rose by 0.3% in February, marking the third consecutive monthly increase.

The Fed's data indicate that the capacity utilization of US production facilities increased to 77% during the reporting period. The overall utilization rate climbed to 78.2%.