UPDATE 1-Peru January GDP weakest in eight months, manufacturing drags

Sat Mar 15, 2014 12:48pm EDT

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LIMA, March 15 (Reuters) - Peru's economy expanded a lower-than-expected 4.23 percent in January, the government said on Saturday, the slowest pace in eight months due to weakness in the manufacturing sector.

While a sustained recovery in the mining sector helped underpin the economy, growth still came in below a Reuters poll forecasting a 4.85 percent expansion.

A weaker appetite for commodities from key Asian customers has stung Peru, the world's third-biggest copper and silver producer, in recent months.

The Andean country's growth eased to 5.02 percent last year, its slowest expansion in four years as mineral exports slipped and domestic demand ebbed.

With January's data, gross domestic product (GDP) growth in the last 12 months was 5.4 percent.

The government is banking on 6 percent growth this year, as large-scale copper projects come on line, though some analysts have deemed the figure overly optimistic.

In seasonally-adjusted terms, the Peruvian economy contracted 0.3 percent in January from December 2013. That comes on the back of a 0.4 percent fall in December from November, also in seasonally-adjusted terms.

Mining expanded 5.5 percent in January year-on-year, slightly more than in December, while manufacturing posted a tepid 0.42 percent increase, lower than in the immediately previous month.

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A couple walks along the rough surf during sunset at Oahu's North Shore, December 26, 2013. REUTERS/Kevin Lamarque

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