U.S. manufacturing output races to 2-1/2-year high

Production at U.S. factories rebounded more than expected in October as the drag from Hurricane Ida faded and motor vehicle output picked up, but manufacturing continues to be constrained by shortages of raw materials and labor.

Manufacturing output surged 1.2% last month to its highest level since March 2019, after falling 0.7% in September, the Federal Reserve said on Tuesday. Economists polled by Reuters had forecast manufacturing production rising 0.7%.

Output increased 4.5% compared to October 2020. Manufacturing, which accounts for 12% of the U.S. economy, is being underpinned by businesses desperate to rebuild depleted inventories.