PREVIEW-Mexico consumer confidence seen down in Oct

MEXICO CITY, Nov 5 (Reuters) - Mexican consumer confidence likely fell in October from September and compared with October 2008, according to a Reuters poll of analysts, underscoring the weakness of Mexico's economic recovery. The consumer confidence index likely fell to 81.4 points in October compared to 81.9 points in September and 82 points a year ago, according to the median of a survey of 10 economists and analysts. Stubbornly high unemployment remains the main factor determining consumer confidence, analysts said.' "We think the effects of the recession will continue to weigh more on consumer confidence than the recent reduction in the annual inflation rate," wrote analysts at Citigroup's Mexican unit, Banamex, in a research note. Unemployment in Mexico reached 6.41 percent in September, the highest level in 14 years. Annual inflation slowed to 4.65 percent in early October, its lowest rate in a year but still above the central bank's medium term target of 1 percentage point above or below 3 percent. Proposed tax hikes and expected increases in government-controlled energy costs aimed at plugging a hole in the federal budget may also affect consumer confidence, analysts said. The national statistics institute is scheduled to release the consumer confidence data at 1430 local time (2030 GMT) on Thursday. (Reporting by Jean Luis Arce; Editing by Kenneth Barry) Keywords: MEXICO ECONOMY/CONFIDENCE ([e-mail]; [phone]; Reuters Messaging: [e-mail]) COPYRIGHT Copyright Thomson Reuters 2009. All rights reserved.

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