US manufacturing output stumbled in August

WASHINGTON (AP) — U.S. factory production fell last month amid cutbacks in appliances, home electronics and machinery, threatening hopes for a manufacturing rebound after two previous months of gains.

Manufacturers have struggled for the past 18 months with sluggish global growth, the strong dollar, and reluctance among U.S. businesses to spend more on large machinery and equipment.

"Despite the strong gains in June and July suggesting that the sector was starting to recover, it appears that manufacturing activity is still struggling to make any headway," said Andrew Hunter, U.S. economist at Capital Economics, a forecasting firm.

Mining production rose 1 percent, the fourth increase in a row after a string of declines that mostly reflected sharp drops in oil and gas drilling due to lower oil prices.

The business spending slump has been led by energy firms, which slashed investment in new steel pipes and machinery after oil prices plummeted.