Factory Output in U.S. Expands More Than Estimated; Wholesale Prices Jump

[Purveyor]

Source: Bloomberg

By Bob Willis

Dec. 15 (Bloomberg) -- Factories in the U.S. churned out more goods in November than anticipated, extending a rebound in manufacturing that will give the world’s largest economy a lift into 2010.

Production climbed 0.8 percent, the fourth gain in the past five months, the Federal Reserve said today in Washington. Another report showed wholesale prices climbed 1.8 percent in November, also exceeding the median estimate of economists surveyed by Bloomberg News, as fuel costs climbed.

Improving global sales and plunging inventories are prompting companies such as Ford Motor Co. to speed up assembly lines, putting manufacturers at the forefront of the economic expansion. The recovery will take time to reduce unemployment and soak up capacity, one reason why Fed policy makers tomorrow are forecast to reiterate a pledge to keep interest rates low.

“We’ll continue to see growth in manufacturing, given strong exports and that consumers are spending,” said Michael Feroli, an economist at JPMorgan Chase & Co. in New York. Fed policy makers will probably say “inflationary pressures are almost non-existent” after viewing the latest data, said Feroli, a former economist at the central bank.

Read more: http://www.bloomberg.com/apps/news?pid=20601087&sid=awEcBCeETCRs&pos=1

[Rosa Luxemburg]

1. We have to export