Industrial production dropped 1.2% in August, while capacity use decreased to 78.2%, the Federal Reserve reported Friday.

Economists polled by Thomson Reuters expected production to rise 0.1% and predicted a 79.3% capacity use rate.

In July production rose 0.5%, originally reported as a 0.6% increase, while capacity use was adjusted down to 79.2% from 79.3%.

The Fed said Hurricane Isaac blew an estimated 0.3 percentage points off production.

Manufacturing output fell 0.7% in August after  a 0.4% climb in July. On a year over year basis, manufacturing production rose 3.8%.

Mining  dropped 1.8% following a 1.0% increase in July, while utilities sank 3.6% after a 1.3% gain in July.

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