MEXICO CITY, March 13 (Reuters) - Mexican industrial production rebounded more than expected in January, rising the most in nearly a year pointing to a strengthening recovery in Latin America’s no. 2 economy.
January industrial activity rose 0.5 percent compared with December, the national statistics agency said on Thursday, gaining at its fastest pace since February.
The figure was above estimates for a 0.4 percent rise in a Reuters poll and up from December’s 0.46 percent contraction.
Data last month showed the economy slowed sharply in the fourth quarter of 2013, dragging annual growth to a four-year low of 1.1 percent and prompting analysts to lower forecasts for 2014.
Mexico’s chief economist Ernesto Revilla told Reuters on Wednesday the economy faces rising risks as the U.S. Federal Reserve withdraws its stimulus but said it was too soon to revise its 3.9 percent growth forecast for 2014.
Data on Thursday showed factory output, a component of industrial production, rose by 2.34 percent in January compared with the prior month, its best showing since September 2012.
Mexico exports mostly manufactured goods and nearly 80 percent of its exports to the United States.
But construction, a sector that dragged on growth last year, contracted 1.23 percent in January, its biggest dip since April, as mining and utilities also dipped.
Manufacturing, utilities, construction and mining are all components of industrial production, as measured by the national statistics agency INEGI.
Industrial output rose 0.7 percent in January from a year earlier, compared to expectations for a 0.32 percent increase and the 0.3 percent contraction notched in December.
Mexico’s central bank in January kept borrowing costs at a record low of 3.5 percent to juice growth despite an uptick inflation above the bank’s target ceiling.