(Adds comment, table) By Silvio Cascione BRASILIA, Dec 2 (Reuters) - Industrial output in Brazil fell more than expected in October as capital goods production slipped for a fourth straight month, in a sign of weakened appetite for investment amid a recession, government data showed on Friday.
Total industrial production fell 1.1 percent in October from September after seasonal adjustments, erasing the 0.5 percent increase seen in the previous month, government statistics agency IBGE said.
The October industrial contraction suggests Brazil's economy continued to slip further into recession in the beginning of fourth quarter, raising concerns that the country's worst downturn in at least eight decades could stretch into 2017.
"This was one of the first data points about the fourth quarter and it was not encouraging," wrote José Francisco Gonçalves, chief economist of Banco Fator, in a research note.
Economists in a Reuters poll forecast a decline of 0.8 percent, according to the median of 20 estimates.
Production in October retreated 7.3 percent from a year earlier, down from a 4.8 percent drop in September.
Output fell in 20 of the 24 industrial activities covered by the IBGE survey, including automobiles and food processing. Capital goods production fell 2.2 percent.
A purchasing managers' survey on Thursday showed no signs of an industrial rebound in November as the sharp currency drop that followed the election of Donald Trump to the White House raised costs for manufacturers.
Brazil's economy is expected to shrink more than 3 percent for a second straight year in 2016, leaving more than 12 million unemployed. Banks and government officials have cut their forecasts for economic growth in 2017 to around 1 percent.
(Percent change) m-m y-y Capital goods -2.2 -9.8 Intermediate goods -1.9 -7.0 Consumer goods -0.4 -7.3 Durable consumer goods -1.2 -6.8 Semi-durable and -0.8 -7.5 non-durable consumer goods Industrial output -1.1 -7.3 (Reporting by Silvio Cascione; Editing by Alison Williams)