Us manufacturing output rose in July for the first time in three months, boosted by a rebound in car production, but other types of production were mixed.

Manufacturing output rose 0.7% in July from a revised 0.4% decline in June, according to data released by the federal reserve on Tuesday. Industrial output, including mining and utilities, rose 0.6 per cent in July from a month earlier. The median forecast by economists was for both manufacturing and overall industrial output to grow by 0.3 per cent.

Despite the strength last month, manufacturing is already slowing and is at risk of further losing momentum as companies face overinventories and slowing domestic demand for goods. Recent manufacturing surveys show a decline in orders, and weak export markets are also a drag against the backdrop of a stronger dollar.

Manufacturing activity in New York recorded its second-biggest monthly decline on record, as orders and shipments fell sharply, according to a survey released by the New York Federal Reserve Bank on Monday. Regional and national data will be released in the coming week, which will help to learn more about the extent of the manufacturing correction.

Tuesday's industrial production report showed that car production rose 6.6%, the biggest increase in four months. The easing of semiconductor supply bottlenecks gives automakers more room to increase production. Excluding cars, manufacturing output increased by 0.3%, after a decline in the previous two months.

The Fed report also showed that factory capacity utilisation rose from 79.3% to 79.8%.