Industrial Production Logs First Decline in 4 Months in July

03:00 PM EDT, 08/15/2025 (MT Newswires) -- US industrial production fell in July to mark the first drop in four months amid declines in mining and utilities output, data from the Federal Reserve showed Friday.

Industrial output decreased 0.1% last month, following an upwardly revised 0.4% increase in June. The consensus was for a flat reading in a survey compiled by Bloomberg.

The index for mining fell 0.4% in July, marking a second straight drop, while the gauge for utilities ticked down 0.2% after a 1.8% increase in June.

Mining activity is taking a hit from low oil prices, Oxford Economics Lead US Economist Bernard Yaros said in remarks e-mailed to MT Newswires.

Manufacturing output was flat last month following two consecutive gains, though durables rose 0.3%. Within durables, the index for aerospace and miscellaneous transportation equipment increased 1.7%, while the indexes for primary metals, machinery, and motor vehicles fell 0.3% each, Fed data showed.

"There is little sign of the (manufacturing) sector benefiting from a switching to US-made products on the back of tariffs, but again, contracts take time to negotiate," ING Bank said in a report published Friday.

US President Donald Trump recently signed an executive order to extend the tariff suspension on China for another 90 days. The US recently issued a list of new reciprocal tariff rates, ranging from 10% to 41%, on different countries. Washington has already finalized trade deals with several trading partners, including the European Union and Japan.

"Taking a step back, we look for a rebound in industrial output next year due to a fiscal boost, interest-rate relief, and investment in the high-tech sectors," Yaros said Friday. "'Reindustrialization' is a buzzword, but we expect the current policy mix will only reinforce those industries where the US is already strongest."

Earlier this month, data from the Institute for Supply Management showed that US manufacturing sector activity contracted at a faster rate sequentially in July. A separate report from S&P Global (SPGI) indicated that manufacturing operating conditions last month deteriorated for the first time this year.

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