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(Recasts with components of GDP)
MEXICO CITY, Nov 20 (Reuters) - Mexico's economy grew at its fastest pace in two years in the third quarter, beating expectations, as industrial output rebounded following a slump in oil output and weak exports in the first half of the year.
The Mexican economy grew 0.8 percent from July to September compared to the prior three months above an estimated 0.6 percent in a Reuters poll and an upwardly revised 0.6 percent expansion in the second quarter.
The figure was also above a preliminary estimate for third-quarter growth from the statistics office issued late last month.
Industrial output, which includes manufacturing, construction, utilities, as well as mining and oil output, expanded by 0.8 percent in the third quarter compared to the second, its fastest pace in over a year and stronger than an upwardly revised 0.1 percent rate in the second quarter.
Industry had largely stalled in second quarter, hit by weak demand for exports in the United States, Mexico's biggest trading partner, and a slump in oil output.
Sinking oil prices and a fall in oil output dampened growth prospects early this year despite a landmark opening of the energy sector in 2013 aimed at drawing private investment.
The services sector expanded by 0.8 percent in the third quarter from the second, just slower than the 0.9 percent quarterly rate seen in the April to June period, the data showed.
Improving domestic demand and rising retail sales have supported growth during 2015.
On an annual basis, gross domestic product (GDP) grew 2.6 percent in the third quarter from the same period in 2014 , above an upwardly revised 2.3 percent pace in the second quarter and a forecast 2.4 percent in the Reuters poll. (Reporting by Michael O'Boyle Editing by W Simon)