Washington (AFP)

US manufacturing output declined in May after a big jump in April, holding total industrial production flat in the month, the Federal Reserve reported Thursday.

The manufacturing sector saw a 0.4 percent drop in production following the 1.1 percent jump in the prior month. Mining activity however surged 1.6 percent, the second straight month of strong increases, while utilities rose 0.4 percent.

Within the key manufacturing sector which represents more than 70 percent of the Industrial Production index, "Almost all major industry groups within durables posted declines," the report said.

This includes a two percent drop in motor vehicles and parts, and a 1.6 percent decline in electrical equipment and appliances.

Excluding motor vehicles and parts, total industrial production would have increased by 0.1 percent.

The 0.1 percent increase in manufacturing of non-durable goods was not enough to offset the decline in durables, and in any case was mostly due to a large jump in chemicals output.

The bright spot in mining means the sector has seen production increase by an average of 1.5 percent a month so far this year, the report said.

Oil and gas production rose 3.8 percent from April, far slower than the increases seen in the prior three months.

Despite the flat headline reading, which was in line with analysts expectations, total industrial production is 2.2 percent higher than the same month of last year. Manufacturing increased 1.4 percent year-over-year, withutilities up just 0.1 percent.

Mining has surged 8.3 percent since May 2016, with oil and gas drilling up an eye-popping 100.5 percent -- something causing consternation among OPEC oil producers who have been trying to boost crude prices by limiting production.

Total industrial capacity in use in the month was little changed from April at 76.6 percent, down just a tenth of a point.

Agence France-Presse

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