Economy’s soft patch still visible

WASHINGTON — Industrial activity edged up by 0.1 percent in August as declines in utility and mining output tempered a gain in factory production.

The small rise in industrial activity reported by the Federal Reserve Wednesday followed a 0.6 percent gain in July.

Although economists were forecasting a 0.5 percent gain for August, some analysts said the report was not as weak as the overall number seemed to suggest. Those analysts took comfort in the fact that manufacturing output grew.

“The report is stronger than appears on the surface. Unlike other parts of the economy, manufacturing activity moved up so I would say in general this is a pretty solid report,” said Stuart Hoffman, chief economist at PNC Financial Services Group. “Utility output was down probably because of the relatively cool summer we had.”

On Wall Street, the Dow Jones industrials lost 86.80 points to close at 10,231.36. The lower-than-expected reading on industrial production along with gloomy forecasts issued by Coca-Cola Co. and several other companies rattled investors.

Federal Reserve Chairman Alan Greenspan, appearing before Congress last week, said economic activity hit a “soft patch” in late spring, which he said was related in large part to high energy prices. But he added at the time that there were some signs the expansion has “regained some traction” such as a pickup in the nation’s payrolls in August.