Mexican Industrial Output Unexpectedly Contracted in August
Mexican industrial production unexpectedly fell in August from the year earlier as construction and mining activity tumbled.
Output contracted 0.7 percent, the national statistics institute said on its website today, compared with the median estimate for a 0.1 percent expansion from 16 economists surveyed by Bloomberg. Construction tumbled 5.1 percent and mining output dropped 2.2 percent. Manufacturing increased 1.6 percent and utilities rose 1.7 percent from the year earlier.
Production expanded 0.5 percent in August from July, the agency said, more than the 0.1 percent median estimate.
The government has cut its forecast for 2013 growth three times this year, to 1.7 percent from 3.5 percent, after the economy in the first half of the year expanded at the slowest pace since 2009, exports stagnated and public spending fell. Policy makers surprised analysts by cutting the benchmark interest rate for a second time this year on Sept. 6, pushing it to a record-low 3.75 percent, saying the economy suffered an unexpected slowdown in the second quarter.
All 24 economists in a survey released by Citigroup Inc.’s Banamex unit this week expect the bank to reduce borrowing costs again by year-end after Hurricanes Ingrid and Manuel last month left at least 157 people dead, with flooding that decimated crops, disrupted deliveries and emptied hotels.
The peso erased its gain from before the report, falling 0.2 percent to 13.1182 per U.S. dollar at 8:21 a.m. in Mexico City.
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