By Vicki Needham - 10/18/10 07:32 PM EDT
Industrial production dropped unexpectedly last month for the first time in more than a year, as expectations grow for more monetary easing and concerns about the strength of the economic recovery increase.
Output fell 0.2 percent in September, the first drop since June 2009, behind a decrease in demand for durable goods like furniture and appliances, according to a report Monday from the Federal Reserve.
Mine production was up 0.7 percent but utilities fell by 1.9 percent. Year-on-year industrial output is up by 5.4 percent.
Last week, Federal Reserve Chairman Ben Bernanke said the central bank may need to provide stimulus by purchasing government debt because the “substantial slack in the utilization of productive resources” was keeping prices down and inflationary pressures below the Fed's preferred levels. The Fed's next meeting is Nov. 2-3.
In September, capacity utilization eased to 74.7 percent, down slightly from 74.8 in August.
Over the past 20 years, the historical average has hovered around 80 percent.