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U.S. factory output falls in April

Published: Sunday, Aug. 30 2015 2:49 p.m. MDT

In this April 10, 2013 in Detroit a line worker inspects wristwatch housings at the Shinola manufacturing facility. U.S. factories cut back sharply on production in April, as auto companies cranked out fewer cars and most other industries reduced output. (AP Photo/Carlos Osorio) (Associated Press) In this April 10, 2013 in Detroit a line worker inspects wristwatch housings at the Shinola manufacturing facility. U.S. factories cut back sharply on production in April, as auto companies cranked out fewer cars and most other industries reduced output. (AP Photo/Carlos Osorio) (Associated Press)

WASHINGTON — U.S. manufacturers cut back on production in April, as auto companies cranked out fewer cars, factories made fewer consumer goods and most other industries reduced output. The weakness suggests economic growth may be slowing.

The Federal Reserve said Wednesday that factory output dropped 0.4 percent in April, the third decline in four months.

Production of autos and auto parts fell 1.3 percent in April. The drop is likely temporary because automakers are reporting stronger sales.

Still, the declines in April were broad-based. Factories produced fewer machines, electrical equipment, clothes, appliances, furniture and primary metals. Manufacturers made more computers and electronic products, among the few areas that showed gains.

Factories are making fewer goods in part because of a weaker global economy, which has reduced demand for U.S. exports. And exports are likely to stay sluggish because the recession of the 17 European Union countries that use the euro has extended into its sixth quarter.

This undated image provided by Hellman's shows an undated advertisement for Hellmann's mayonnaise. Hellman's turns 100 in 2013 and to celebrate the anniversary, owner Unilever Food is launching a marketing campaign including a Facebook page and YouTube videos featuring chef Mario Batali cooking up his favorite Hellman's recipes, a smartphone app and a June event featuring the world's largest picnic table. (AP Photo/Hellman's) (Associated Press) This undated image provided by Hellman's shows an undated advertisement for Hellmann's mayonnaise. Hellman's turns 100 in 2013 and to celebrate the anniversary, owner Unilever Food is launching a marketing campaign including a Facebook page and YouTube videos featuring chef Mario Batali cooking up his favorite Hellman's recipes, a smartphone app and a June event featuring the world's largest picnic table. (AP Photo/Hellman's) (Associated Press)

"American manufacturers are continuing to struggle in the face of subdued global demand," said Paul Dales, senior U.S. economist at Capital Economics.

Overall industrial production, which also includes output at utilities and mines, dropped 0.5 percent in April. That's the biggest decline since August. Utility production plunged 3.7 percent, as power output returned to more normal levels after an unusually cold March.

A separate regional manufacturing report indicated that factory activity in the New York region shrank in May, signaling further weakness.

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