By Kate Davidson and David Harrison

WASHINGTON-U.S. factory production fell in October for the third time in four months, the latest evidence that slower global growth and persistent trade tensions are weighing on the manufacturing sector.

Total industrial production declined 0.8% in October from the previous month, the biggest decrease since May 2018, the Federal Reserve said Friday. Economists surveyed by The Wall Street Journal had expected a 0.5% drop.

Manufacturing output, the biggest component of industrial production, declined 0.6% in October, the most since April. That followed a 0.5% drop in September,

The Fed attributed much of the decline to an ongoing strike last month at General Motors, which dragged down output of motor vehicles and parts by 7.1%, the biggest decline since January.

Excluding autos, manufacturing output was still down 0.1% last month and the broader index of industrial production was down 0.5%, suggesting broader weakness in production at U.S. factories. Mining production also fell 0.7% last month, while utilities output declined 2.6%.

The U.S. is a service-oriented economy, meaning manufacturing accounts for a small share of gross domestic product. Still, the sector is highly sensitive to swings in global demand, making it an important indicator of broader economic shifts.

Over the past 18 months, factories have been hit by softening demand for their exports and slowing investment spending as businesses opted to wait out a lengthening period of unusually high uncertainty about future trade relations between the world's leading economies.

The Institute for Supply Management's manufacturing index rose slightly to 48.3 last month from September's 47.8. Readings above 50 denote expansion, while those below 50 are a sign of contraction.

Surveys of purchasing managers released earlier this month indicated the sector continued to cool in October in the U.K. and much of Asia, although there were some signs that the pace of contraction has started to level off.

Recent data suggests underlying demand in the U.S. economy is strong, a recent recession fears have ebbed recently despite manufacturing weakness. Retail sales rose 0.3% in October from a month earlier, the Commerce Department said in a separate report released Friday, suggested consumer spending remains on solid footing. Job openings still exceed the number of unemployed Americans, and hiring is solid.

Write to Kate Davidson at kate.davidson@wsj.com and David Harrison at david.harrison@wsj.com.

(END) Dow Jones Newswires

November 15, 2019 09:30 ET (14:30 GMT)

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