Two reports released Friday are being seen as positive signs for the U.S. economic recovery.

On the inflation front, the U.S. consumer price index rose 0.2% in July, on both headline and core rates. This was in line with consensus expectations for the headline, and a bit higher than expected for the core rate.

“The CPI results suggest that U.S. inflation may have stopped declining, and should further put deflation concerns to rest,” said BMO Nesbitt Burns.

Tobacco prices led the way with a 1.2% increase, and medical costs rose 0.5%.

U.S. industrial production rose 0.5%, which was better than expected, boosted by a big gain in utilities output and a third straight monthly rise in factory activity, the Federal Reserve said.

Production at factories, mines and utilities jumped a larger-than-expected 0.5%, the Fed said, its biggest rise since January’s 0.7% gain. Firms also ran at a faster 74.5% of full capacity in July, up from 74.2% in June.

“As has been the recent trend, the high-tech sector was a source of strength, particularly computers and office equipment. The few sources of disappointment in the report included a slowdown in non-durable goods, as well as telecommunications equipment, which remains the weakest component of the tech sector,” said Nesbitt.

“The blackouts in the northeast raise some concerns about the August industrial production data (due out September 15th), but do not erode the underlying trend toward improvement,” Nesbitt added.

The only downbeat note was the Empire State Manufacturing Survey, which dropped more than expected, with the overall index dropping to 10.0 in August, a four month low, from 20.8 in the prior month.

“The slippage in the Empire State index is a touch disappointing, but it’s still in positive territory and only covers one region,” Nesbitt said.