Itaú BBA - Broad retail sales fall 0.8% mom/sa in December

Macro Brazil

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Broad retail sales fall 0.8% mom/sa in December

febrero 12, 2020

Widespread weakness in the retail sector


For the version with all charts and tables, please open the attached pdf file

 

 In December, core retail sales dropped 0.1% mom/sa, weaker than market expectations (+0.2%) and somewhat below our forecast (0.0%). The broad index, which includes vehicles and construction material, fell 0.8% (market: -0.4%, Itaú: -0.5%).

 Eight out of 10 retail categories posted declines in December, with growth only in furniture & household appliances and books & newspapers. Supermarket sales retreated, probably due to the temporary shock in food inflation that month.

 We expect consumer spending to sustain a moderate growth pace throughout 2020, encouraged by credit in particular. However, consumption will likely lose momentum in 1Q20, given the negative statistical carryover from retail sales and the end of the positive effect on consumer spending that resulted from withdrawals from the FGTS workers’ fund.

 

Luka Barbosa
Matheus Felipe Fuck


For the version with all charts and tables, please open the attached pdf file
 



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