U.S. factory production unexpectedly increased in December amid a surge in primary metals output that offset a decline at motor vehicle assembly plants, but activity contracted in the fourth quarter against the backdrop of challenges from import tariffs. Manufacturing output rose 0.2% last month after an upwardly revised 0.3% gain in November, the Federal Reserve said on Friday. Economists polled by Reuters had forecast production for the sector, which accounts for 10.1% of the economy, falling 0.2% after a previously reported unchanged reading in November.