(Adds details from report, background on Argentina economy)
BUENOS AIRES, Feb 23 (Reuters) - Argentina's industrial production fell 1.1 percent in January from the same month a year earlier, national statistics agency Indec said on Thursday, the twelfth straight month of shrinking output.
The drop was the smallest year-on-year since February 2016 and marked the third consecutive month of smaller declines in a sign that Argentina's prolonged recession could be nearing its end. Argentina's economy grew in the fourth quarter of 2016 with respect to the previous quarter, Treasury Minister Nicolas Dujovne said on Wednesday.
The reading was in line with a Reuters poll that showed the median expectation was for a 1 percent year-on-year decline. An 11.6 percent decline in the steel industry's activity weighed on industrial output, while the automobile industry, after a difficult 2016, grew a whopping 71.1 percent.
Industrial production fell 2.3 percent year-on-year in December, and 4.6 percent overall in 2016 from 2015. (Reporting by Luc Cohen; editing by Grant McCool)