US industrial production rose 0.1% in February, while the 0.4% increase was expected

Luke Sharrett | Bloomberg | Getty Images

A worker welds metal components on a round baler at New Holland Ltd.'s Haytools badembly plant in New Holland, Pennsylvania, on Wednesday, December 19, 2018.

US manufacturing output fell for a second consecutive month in February, providing further evidence of a marked slowdown in economic growth early in the first quarter.

The Federal Reserve said Friday that manufacturing output fell 0.4% last month, due to lower production of motor vehicles, machinery and furniture. January data were revised upwards to indicate that factory production fell by 0.5% instead of 0.9%, as previously reported.

Economists polled by Reuters forecast industrial production up 0.3% in February. Factory output rose 1.0% in February from a year ago.

Motor vehicle and parts production fell 0.1% last month after dropping 7.6% in January. Excluding motor vehicles and parts, manufacturing output declined 0.4% last month.

The decline in manufacturing output in February added to the weak relationship between retail sales and housing, suggesting that the economy lost momentum early in the first quarter. Goldman Sachs expects gross domestic product to grow at an annualized rate of 0.6% in the first quarter. The economy grew at a rate of 2.6% in the fourth quarter.

Manufacturing activity, which accounts for about 12% of the economy, is running out of steam as capital expenditures resulting from the $ 1.5 trillion reduction in last year's tax cut have blurred. The activity is also hampered by a trade war between the United States and China, as well as by the rising dollar and slowing global economic growth, which weigh on exports.