Peru economy grew 0.94 pct in February - government

LIMA, April 15 (Reuters) - Peru's economy expanded narrowly in February, growing 0.94 percent from the same month a year ago, missing market expectations as construction and mining activity dropped, the government said on Wednesday.

The official growth reading, released by the state statistics agency Inei, was below the 1.35 percent expansion forecast in a Reuters poll. It also marked a slowdown from January's 1.68 percent expansion and the 5.42 percent surge posted in February 2014.

At a seasonally adjusted rate, Peru's economy shrank 0.3 percent in February from January, Inei said. The economy grew 1.81 percent in the past 12 months through February and 1.31 percent in the first two months of 2015, Inei said.

Peru's mining-fueled economy has repeatedly missed government and central bank expectations for a recovery over the past year as growth has slowed sharply to its weakest pace since 2009.

Year-on-year growth was just 1 percent in the fourth quarter of 2014, when gross domestic product rose 2.35 percent. In previous years, the economy expanded by more than 5 percent.

In February, construction activity slid 9.88 percent from the same month a year prior, the biggest drop since June 2011, Inei said. A pause in public works as local authorities transition into power this year has compounded a lull in the building of mines and homes.

Mining and hydrocarbon activity dipped 2.4 percent in February - reversing a 5.6 percent surge in January - as copper output slid 11.7 percent and protests at the country's biggest oil block contributed to a 21.2 percent drop in oil production, Inei said.

Manufacturing activity was also down in February, 4.28 percent from the same month a year ago, because of shrinking fishmeal, metals and oil processing and a 3 percent drop in the production of consumer goods, according to Inei.

February growth was driven by domestic demand, with retail activity up 3.35 percent and services expanding 4.7 percent. The central bank said last week that growth would likely pick up in March, and that it was adopting a more neutral policy stance because of the weakening currency and an unexpected quickening of inflation.

Suggesting a potential recovery, Inei said that electrical consumption for March rose by 5.7 percent, up from around 4 percent in January and February. The government expects the economy to grow by about 4.2 percent this year, a forecast many analysts view as too optimistic.

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