UPDATE 1-Argentina trade surplus shrinks, factory output falls in January
BUENOS AIRES Feb 21 (Reuters) - Argentina's economy showed signs of strain in January as the trade surplus narrowed and factory output fell in a month that saw a sharp currency devaluation and inflation rise at its fastest pace in nearly 12 years, government data showed on Friday.
The trade balance in South America's second-largest economy shrank 88 percent in January compared with the same month a year earlier to $35 million, the lowest surplus since March 2001, the national statistics agency INDEC said.
Analysts polled by Reuters had expected a January trade surplus of $346 million.
Argentina devalued its peso currency, which shed over 18 percent of its value in January, sending shudders through global markets. The government also unveiled a new consumer price index in the month, showing inflation rose 3.7 percent in the month.
A healthy trade surplus is particularly crucial for Argentina, which has been virtually shut out of international credit markets after a 2002 default.
In January, industrial production shrank 2.6 percent from the same month in 2013. Factory output, meanwhile, rose 1.6 percent in January from December on a seasonally adjusted basis, according to INDEC.
Auto production, a key pillar of the Argentina economy, slid 13.5 percent in January.
A Reuters poll showed that analysts had forecast a 4.5 percent drop in factory output during the month, according to the median estimate. Continuación...