A welder builds parts for finished petroleum tanks at Southern Tank and Manufacturing Inc. in Owensboro, Kentucky, U.S.

U.S. manufacturing output rebounded more than expected in February and recorded its largest increase in six months, in the latest sign that economic activity is gaining momentum after being dampened by severe weather.



Factory production increased 0.8 percent last month, its largest increase since August, the Federal Reserve said on Monday. That almost unwound January's 0.9 percent decline, which was the largest drop since May 2009.

Manufacturing added to other data such as retail sales and employment that have suggested the economy was regaining strength after abruptly slowing down at the end of 2013 and early this year as an unusual cold winter took its toll.

Last month, mining production rose 0.3 percent, but utilities output fell 0.2 percent. The rise in manufacturing and mining output helped to lift overall industrial production 0.6 percent in February.

Production at the nation's mines, factories and power plants had slipped 0.2 percent in January.

Economists polled by Reuters had expected manufacturing output to rise 0.2 percent and industrial production to edge up 0.1 percent last month.

Last month, the amount of industrial capacity in use increased to 78.8 percent from 78.5 percent in January.

Industrial capacity utilization, a measure of how fully firms are using their resources, was 1.3 percentage points below its long-run average.

Officials at the Fed tend to look at utilization measures as a signal of how much "slack" remains in the economy, and how much room there is for growth to run before it becomes inflationary.

A separate report released earlier Monday showed factory activity in the New York state region accelerated in March.



—By Reuters