(Corrects construction drop in paragraph four to 2.67 percent,
not 3.96 percent)
* December industrial output falls 2.1 percent vs November
* Manufacturing dips, construction falls sharply
MEXICO CITY, Feb 11 Mexican industrial
production slumped in December by the most since a deep
recession four years ago as factories slowed and construction
activity fell sharply in Latin America's second biggest economy.
Industrial output fell 2.1 percent in December
compared to the previous month, its biggest drop since May 2009,
when Mexican factories were dragged down by a U.S. recession.
Mexico sends most of its exports to its northern neighbor.
The data was below a 0.2 percent rate of expansion seen in a
Reuters poll and the upwardly revised 1.28 percent
month-on-month rate posted in November.
Among industrial components, manufacturing contracted 1.07
percent in December from the previous month. Construction slid
for its third month in a row, down 2.67 percent compared with
November, while mining and utilities output also slipped.
Solid U.S. demand has helped support Mexican factories amid
sluggish global growth. Mexico's economy is seen slowing from an
around 4 percent annual rate in 2012 to 3.5 percent in 2013.
Mexico's central bank has said it could lower borrowing
costs if inflation continues to cool and economic growth slows.
The market is betting on an at least 25 basis point cut this
year to the country's 4.50 percent benchmark rate.
Compared with December 2011, overall industrial
output dropped 1.1 percent, missing expectations for a 2.0
percent rise and worse than November's upwardly revised 2.9
(Reporting By Michael O'Boyle)