* Industrial output up 0.9 pct m/m vs 1.1 pct forecast
* Mining, manufacturing activity rise in November
* Construction, utilities drag down indicator
MEXICO CITY, Jan 11 Mexico industrial output
edged up in November to a five-month high but missed
expectations for a stronger rebound, tempering optimism about
how Latin America's no. 2 economy will withstand sluggish global
Industrial production rose 0.9 percent in
November, seasonally adjusted, rebounding from the 0.9 percent
contraction notched in October, according to data released by
the national statistics agency on Friday.
But the figure missed expectations for a 1.1 percent
expansion forecast in a Reuters poll and economists said
manufacturing activity likely lost momentum in late 2012.
"Industrial activity is showing clear signs of deceleration
with most trend measures and leading indicators pointing to a
poor performance for Q4 '12 as a whole," said Italo Lombardi, a
Latin America economist with Standard Chartered in New York.
Manufacturing - which accounts for almost 20 percent of
Mexico's total economic output - rose 1.1 percent in November
and mining grew 3.38 percent. But overall production was dragged
down by a 0.97 percent fall in construction, its second monthly
contraction in a row, and by a dip in utilities.
It was the first time construction activity fell on an
annual basis since mid-2010, the data showed.
Mexico's central bank has said it sees the global economy as
a threat to economic growth and policymakers are expected to
keep the benchmark interest rate at 4.50 percent into 2014,
according to bets on Mexican interest rate swaps..
Compared with November 2011, output rose 2.8
percent, missing expectations for a 3.2 percent rise and worse
than October's downwardly revised 3.4 percent expansion.
Banorte analysts said manufacturing activity was hit by a
stronger peso, making Mexico's exports more expensive as the
peso gained more than 10 percent in the second half of 2012.
Still, economists stuck with forecasts for Mexico's economy
to expand around 4 percent in 2012, outperforming the expected
"It's not a sign that the economy is starting to turn off,"
said Jorge Gordillo, an analyst at CI Banco in Mexico City.
Construction was a concern, he said, but the numbers had not
changed his predictions for growth above 4 percent for 2012.
A rise in U.S. manufacturing in December is also a positive
s ign as M exico sends nearly 80 percent of its exports to the
United States, and its factories operate nearly in lock step
with their counterparts north of the border.
President Pena Nieto's administration, which began in
December, has projected Mexico's economy will grow 3.5 percent
in 2013, down from an estimated 3.9 percent in 2012 as the
global slowdown weighs.