Mexico's Economy Slows Less than Expected

Mexico's economic growth slowed less than expected in the second quarter as robust output in services continued to compensate for a modest advance in industrial production.

Gross domestic product, a broad measure of output of goods and services, expanded at a seasonally adjusted rate of 0.6% from the previous quarter, and was up 1.8% from the second quarter of 2016, according to a preliminary reading published Monday by the National Statistics Institute. The next GDP report is due Aug. 22.

Growth from the first quarter was ahead of economists' expectations of 0.2%, and translated into an annualized rate of 2.4%, a slowdown from the first quarter's 2.7% expansion.

Industrial production edged up 0.1% from the first quarter while services grew 0.8%.

Strength in manufacturing, supported by demand for exports, has offset a sluggish construction sector and lower oil and gas production. Services continue to be supported by employment growth, despite pressure on wages from this year's rise in inflation.

Output compared with a year earlier was affected by the Easter holiday in April, which gave the second quarter fewer working days than in 2016. Adjusted for the calendar effect, output was 3% higher than a year before, the statistics institute said.

Write to Anthony Harrup at

(END) Dow Jones Newswires

July 31, 2017 10:18 ET (14:18 GMT)