U.S. Industrial Output Climbed 0.6% in February --- In Another Sign of Upturn, Home Starts Jump 9.6%; Prices Increase Modestly
WASHINGTON -- The government reported new evidence of economic recovery, with industrial production and housing starts jumping in February while consumer prices rose modestly.</br></br>Total production by all industries rose 0.6% in February, for its first increase since October, with a strong showing in autos accounting for roughly half of the jump, the Federal Reserve Board reported. That follows a revised decline of 0.8% in January. Industry used 78.2% of its capacity in February, up from 77.9% in January, the Fed said.</br></br>Meanwhile, the prices paid by consumers for goods and services increased 0.3% last month, following a 0.1% January increase, the Labor Department announced, as rises in clothing prices and health-care costs partially offset a drop in energy prices.</br></br>The 9.6% increase in home-building, to an annual rate of 1,304,000, came as low interest rates continued to propel the industry, especially in the Midwest. February single-family housing starts shot up 15%, the Commerce Department said.</br></br>"I think the worst is definitely behind us, and this wave of restructuring has now crested," said Norman Robertson, chief economist for Mellon Bank in Pittsburgh. "And while we may see further layoffs, I don't think they'll be of the same magnitude as those of the last year," he said, adding that "I think this recovery is going to take hold, maybe even just in time for Mr. Bush."