While other data on Thursday showed industrial output shrank for the first time in seven months in November,
much of the decline came from auto production, which analysts said was held back by temporary supply disruptions.
"The regional surveys suggest there is good demand rebuilding for the industrial sector," said Michael Strauss, chief economist at Commonfund in Wilton, Connecticut.
"So it looks like fourth quarter GDP in the US is going to be at or slightly above 3 percent. That, at least for today, will negate some of the challenges of Europe."
Stocks on Wall Street rose on the data, while prices for US Treasury debt were little changed. The dollar fell against a basket of currencies.
While growth is quickening from the third quarter's 2 percent annual rate, analysts caution that troubles in debt-stricken Europe pose a major risk to the US economy.
Much of the rest of the global economy is already weakening, with the euro zone expected to face recession.
The US economy also faces a risk that lawmakers will fail to extend a payroll tax cut and emergency jobless benefits that expired at year end, which would dent the expansion in 2012.
For now, however, it continues to show resilience.
Initial claims for state unemployment benefits dropped 19,000 to 366,000, the lowest since May 2008, the Labor Department said. That follows on the heels of a report earlier this month that showed the jobless rate hit a 2-1/2-year low of 8.6 percent in November.
The economy's firming tone was also captured by data showing an acceleration in factory activity in New York state and the Mid-Atlantic region this month.
The Philadelphia Federal Reserve Bank said its index of business conditions rose to its highest since March as new orders surged. A separate report showed business activity in New York state at its highest since May, with a strong rebound in new orders and an improvement in hiring.
But the Fed's industrial production report took off some of the shine from the two regional factory surveys. Output at the nation's mines, factories and refineries dropped 0.2 percent in November after rising 0.7 percent in October.
The decline was led by a 0.4 percent drop in factory output, which reflected a 3.4 percent slump in motor vehicle production.
Economists, however, blamed a scarcity of auto parts from flood-ravaged Thailand for the weakness. They said it also likely weighed on production of high-technology goods, which were down sharply for a third month running.
"We are not worried about the health of the manufacturing sector," said Michelle Girard, a senior economist at RBS in Stamford, Connecticut.
"Inventories are lean and firms will likely need to restock after a decent holiday season. Automakers also plan healthy production increases in the first quarter."
The drop in first-time claims last week pushed them closer to the 350,000 mark that analysts say would signal a more sustained improvement in the job market. A four-week moving average, which smoothes out weekly volatility, dropped to the lowest level since mid-July 2008.
FedEx Corp on Thursday provided a further signal the economy was gaining momentum, saying demand for residential delivery services was rising with "healthy growth" in online shopping.
Another report from the Labor Department showed wholesale prices rose 0.3 percent last month, reversing October's 0.3 percent fall, as food prices climbed 1 percent.
Excluding food and energy, producer prices were up a mild 0.1 percent last month after being flat in October, suggesting little buildup in broad inflationary pressure.
