WASHINGTON — Strong auto production drove factory output higher for a second straight month in August. But manufacturing was otherwise weak last month, a troubling sign for the economy.
The Federal Reserve said Thursday that factory output rose 0.5 percent in August, after increasing 0.6 percent in July.
Autos and related products increased 2.6 percent, evidence that supply chain disruptions stemming from the Japan earthquake continued to ease.
Overall industrial production ticked up 0.2 percent. That was weaker than July’s 0.9 percent increase.
Separately, the Federal Reserve Bank of New York said manufacturing weakened in that region for a fourth straight month, partly because businesses received fewer new orders and paid higher prices.
U.S. manufacturing has been one of the strongest sectors of the economy since the recession ended. But it slowed this year, in part because of the supply chain disruptions but also because consumers have grown more cautious.
Retail sales were unchanged in August from July, the government said Wednesday. Consumers spent less on autos, clothing and furniture.
Analysts said Hurricane Irene likely disrupted sales along much of the East Coast. But many consumers pulled back after a series of events that suggested the economy was at risk of another downturn.
The government reported that the economy barely grew in the first half of the year. Lawmakers fought over raising the debt ceiling. Standard & Poor’s downgraded long-term U.S. debt for the first time. Stocks tumbled — the Dow lost nearly 16 percent of its value from July 21 through Aug. 10.
As a result, consumer confidence fell in August to its lowest level since April 2009, when the economy was still in recession. And employers added no net jobs during the month.
Consumer spending is important because it accounts for 70 percent of economic activity. When consumers pull back, manufacturers respond by slowing their production lines.
Europe’s financial problems also threaten U.S. manufacturers. Sales to Europe account for about a quarter of U.S. companies’ revenue, analysts say. If Europe tips back into recession, demand for their products would decline.