By Nathan Gill

     Nov. 28 (Bloomberg) — Chilean industrial production unexpectedly fell and industrial sales had their second-biggest decline of the year in October as the global financial crisis slowed economic growth.

     Output dropped 0.8 percent last month from October 2007, the National Statistics Institute said today, compared with a revised 3.6 percent expansion in September. Economists expected output to rise 1.0 percent, according to the median estimate of 13 analysts surveyed by Bloomberg.

     “The numbers are weak,” Rafael de la Fuente, an economist at BNP Paribas in New York, wrote today in a note to clients. “This is a good gauge of the slowdown in domestic demand Chile is currently witnessing.”

     Chile’s central bank has said that economic growth may slow next year as the global downturn curbs demand for Chilean exports and internal demand falls. Chilean President Michelle Bachelet said yesterday that the economy is prepared to face the global financial crisis and the government’s top priority in the next 15 months will be to control the fallout from any slowdown.

     Industrial sales fell 3.9 percent last month, compared with a 2.6 percent rise in September and 4.0 percent decline in August, the institute said. The October and August results are the worst since June 2002. Economists expected a 0.4 percent rise, according to the median estimate of eight analysts surveyed by Bloomberg.

      Unemployment fell to 7.5 percent, down from 7.8 percent in September and was lower than the 7.7 percent forecast in a Bloomberg survey of 14 economists.