MEXICO CITY (Reuters) - Economic growth in Mexico accelerated faster than expected at the end of last year as a jump in the service sector helped the country shrug off a slowdown in the United States, its main trading partner.

The Mexican economy grew at a 3.8 percent rate in the fourth quarter, the government said on Tuesday.
Economists see Mexico weathering a possible recession this year in the United States, as expanding credit allows consumers to spend more on products ranging from refrigerators to plane tickets.
Mexico's export-oriented factories in recent years had contributed strongly to growth and job creation, but also made the economy dependent on U.S. demand.
Now, several years of low inflation and largely balanced budgets have helped stabilize the economy and bring down interest rates, increasing access to credit and encouraging consumer spending.
“What we are basically seeing is that internal factors like the service sector are becoming more important than manufacturing and industry,” said Octavio Gutierrez, an economist at BBVA Bancomer in Mexico City.
Economists polled by Reuters had expected the economy to grow at a 3.4 percent pace during the fourth quarter. The quarter's growth outpaced the 3.7 percent pace clocked during the previous three months.
The acceleration came even as growth in the U.S. economy slowed to 0.6 percent in the fourth quarter from 3.9 percent the prior quarter.
Mexico’s growth for the 2007 full year was 3.3 percent, down from 4.8 percent the previous year.
The government sees growth slowing further to about 2.8 percent in 2008. Economists say that won’t put much of a dent in rampant poverty, but it is not bad for a country that sends 80 percent of its exports to the United States.
Many economists expect downturns in the U.S. credit and housing markets to widen into a U.S. recession this year.
In the fourth quarter, services, which account for more than two thirds of the economy, grew 4.9 percent and agriculture was up 1.9 percent, the government said.
Although automobile production has recently recovered, industrial output increased at only a 1.8 percent rate in the fourth quarter. Manufacturing expanded 1.5 percent.