US industrial production continues to struggle

US' total industrial production fell 0.2% m/m in September in line with consensus expectations. Manufacturing output (-0.1% m/m), which accounts for three-quarters of total industrial production, fell less than expected in September. 

Motor vehicle and parts production rose 0.2% m/m against the expectation of a modest decline. Durable goods manufacturing was down 0.2% m/m, and nondurables were flat on the month. 

Outside of the manufacturing sector, utilities output rose as expected (1.3% m/m) and mining fell 2.1% m/m. Oil and gas well drilling, the detailed series within the mining sector that tracks rig counts, was down 3.8% m/m.

Despite the smaller-than-expected decline for manufacturing output in September, the sector is continued to be seen as facing considerable headwinds from a stronger dollar, lower energy prices, and slowing growth abroad. 

Manufacturing output is a relatively modest share of total output for the US, however, and the recent slowing is not expected to lead to a broader pullback in aggregate growth, as service sector activity remains solid. 

"The details of the September industrial report that affect the GDP tracking estimate were close to the expectations and leave the Q3 estimate unchanged at 1.2%", states Barclays.