Labourer guides as slag is poured into a container at Dongbei Special Steel Group Co. Ltd. in Dalian
© China Daily China Daily Information Corp - Cdic / Reuters
A labourer guides as slag is poured into a container at Dongbei Special Steel Group Co. Ltd. in Dalian, Liaoning province December 27, 2013. REUTERS/China Daily
updated 12/30/2013 8:31:35 AM ET 2013-12-30T13:31:35

SANTIAGO (Reuters) - Chile's economy showed signs it was continuing to slow mildly in November, with manufacturing output slipping for the fourth month straight, even as consumption and the labor market remained firm.

Manufacturing production fell 1.1 percent in November from a year earlier due in part to lower production of some steel and iron products, government data showed on Monday.

The fall was slightly smaller than a Reuters poll forecast for a 1.3 percent decrease.

Retail sales grew at a healthy 9.2 percent pace from a year earlier, government data also showed on Monday. Still, that was lower than the 13.4 percent increase in October and the 10.7 percent expansion posted in November 2012.

Mining powerhouse Chile is heavily dependent on exports and domestic consumption, so manufacturing and retail sales are closely monitored.

The jobless rate for the September to November period inched down to 5.7 percent, as employment in agriculture, livestock, forestry, construction and real estate picked up, the government's INE statistics agency reported separately.

Analysts surveyed had expected the jobless rate to remain steady at 5.8 percent.

The central bank's five-person governing board was unanimous in its decision to hold the key interest rate at 4.50 percent on December 12, though they also weighed cutting the rate, minutes of the meeting showed earlier on Monday.

The central bank took a breather after cutting the rate by 25 basis points in both October and November as the economy cooled.

The decision to keep the rate on hold "was justified in that the slowdown of the economy had been mild and it was expected to grow steadily in the coming quarters," the minutes said.

"Plus two cuts had been made to the policy rate, which were working and would continue to gradually affect the components of demand that were the most sensitive to credit costs," the bank added.

The market largely expects the bank to stick to a wait-and-see stance in the short-term to get a stronger sense of where Chile's two-track economy is heading.

"The scenario of slowing domestic demand coupled with good growth in the natural resources sector is unchanged," said Matias Madrid, chief economist at Banco Penta. "This will likely lead the central bank to hold the rate again in January."

Meanwhile, data released on Monday showed that world No. 1 copper producer Chile produced 514,889 tonnes of copper in November, a 7.6 percent increase from the year before, due to a recovery in a major deposit that had a troubled 2012.

Chile, which produces a third of the world's copper, is struggling with dwindling ore grades in many of its aging deposits, although new mines have helped increase output in 2013.

(Reporting by Santiago newsroom; Editing by Chizu Nomiyama)

(c) Copyright Thomson Reuters 2013. Check for restrictions at: http://about.reuters.com/fulllegal.asp

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