By David Harrison

U.S. industrial production increased in July for the third month in a row, as the economy continues its slow recovery.

Industrial production--a measure of output at factories, mines and utilities--rose a seasonally adjusted 3% in July from June, the Federal Reserve said Friday, following a revised 5.7% rise in June. Economists surveyed by The Wall Street Journal expected a 2.8% increase in July.

Despite the gains, production was 8.2% below its level a year earlier.

Manufacturing, the biggest component of production, rose 3.4%, driven by a 28.3% increase in car and car parts industries.

Production by utilities was up 3.3%, due to an increased use of air condition because of unusually warm weather. Mining increased 0.8%.

Capacity utilization, a measure of slack in the industrial economy, rose to 70.6% in July from a revised 68.5% in June, the Fed said. Economists had expected capacity utilization to reach 70.2%.

Earlier this month, two surveys of purchasing managers also indicated manufacturing activity was slowly expanding, following a sharp decline in the spring when lockdowns to prevent the spread of the coronavirus pandemic shut down factories and disrupted supply chains.

Write to David Harrison at david.harrison@wsj.com

(END) Dow Jones Newswires

August 14, 2020 09:49 ET (13:49 GMT)

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