US industrial production rises more than expected in August

U.S. industrial production grew more than expected in August, with most of the gains being driven by the auto sector, amid little sign of a recovery in the broader manufacturing sector that has been lagging.

Federal Reserve data released Tuesday showed industrial production rose 0.8%, well above the 0.2% forecast by economists in a Wall Street Journal survey.

Meanwhile, industrial output was flat compared with the same month a year earlier, which reflects the continued weakness in the manufacturing side of the economy. Excluding the auto sector, output grew by a modest 0.3%.

The amount of space factories actually rose to 78.0%, from 77.4%, while the utilization rate remained about 1.7% below its long-run average.

Manufacturers are expected to eventually get a boost from lower U.S. interest rates, as the Federal Reserve prepares to cut borrowing costs sharply over the next year.