ORIGINAL:

Industrial production contracted at a greater than anticipated rate in August as Hurricane Isaac shut down mining and utility companies across the Gulf of Mexico, new data from the Federal Reserve shows.

Headline industrial production fell 1.2 percent in August, reversing the revised 0.5 percent gain in July. Economists were looking for no change in production.

The country's central bank attributed three tenths of a point of the fall to Hurricane Isaac, as oil rigs in the region closed before the storm entered the region.

"Precautionary shutdowns of oil and gas rigs in the Gulf of Mexico in advance of the hurricane contributed to a drop of 1.8 percent in the output of mines for August," the Fed said in its statement. "The output of utilities declined 3.6 percent."

Capacity utilization also fell during the period off a full percentage point to 78.2 percent.

Among durable goods production, the auto sector took the greatest hit — with manufacturing in the industry falling 4.7 percent.

The steep drop spooked some investors, but TD Securities Economist Millan Mulraine said the declines were mostly anticipated corrections.

"The sharp drop in industrial production in August, while concerning, is not entirely surprising as it represents the anticipated correction in the series, bringing the performance of this sector in line with the tone of the various sentiment indicators that have been consistently point to weaker output since June," he says.

Below, key output from the Fed.

UPDATE:

Minutes away from the next major economic announcement of the day: August Industrial Production.

Economists polled by Bloomberg forecast production will be unchanged from a month earlier, up from earlier expectations for a slight contraction.

Capacity utilization is expected to tick down slightly, to 79.2 percent from 79.3 percent a month earlier.

The report is scheduled for release at 9:15 a.m.