Total industrial output, which includes mines and utilities, climbed 0.6 percent as oil drilling rose for the first time since September.

At 9:15 a.m. ET, the Federal Reserve will release data on industrial production and capacity utilization for July.

Motor vehicle output surged 10.6 percent in July. A bumpy global economy, the stronger U.S. dollar and a slowdown in the oil and natural gas industry are all factors holding back manufacturing expansion.

“A rebounding manufacturing sector is indicative of improvement in broader economic activity”, Gennadiy Goldberg, U.S. strategist at TD Securities LLC in New York, said before the report. “Business surveys have been generally positive, and ISM new orders has risen for four consecutive months”.

Industrial production in June advanced by a revised 0.1 percent.

The bigger than expected increase in production came as manufacturing output increased by 0.8% in July after dipping by 0.3% in the previous month. Economists had expected a capacity utilization rate of 78.1%.

Output in the utilities sector fell 1% in July, following a 2.3% increase the previous month. The capacity utilization rate is a measure of percentage of factory resources being employed, with a reading above 85 percent usually considered to be inflationary.