MexECON Blog

June Consumer Confidence Rises

Mexico's June consumer confidence index rose by a seasonally-adjusted 1.7%, accelerating from a revised increase of 1.3% in May.  Prior to that, consumer optimism in Mexico had fallen for two straight months.  According to the report, from the official statistics agency INEGI, the rise in the confidence index during June reflected increases in all five subindexes.  The biggest jump was in the subindex on future expectations for the country as a whole, which rose 2.4%, marking its best increase since last September.  In addition, the subindex on consumers' willingness to buy durable goods rose 2.3%, and the subindex on consumers' view of the current situation of their own family rose by 2.1%.

Comment:  Consumer confidence in Mexico has now posted its first back-to-back increases since the beginning of 2011.  The rebound is consistent with incoming data for June that suggests exports may be reaccelerating and manufacturing might be gathering strength again, in spite of the global economic recovery hitting a soft spot this spring.  In any case, rising optimism means Mexican consumption spending could continue to rise and help offset any potential slowing on the industrial side of the economy.  The global soft spot is still a risk for the Mexican economy, but today's report provides some comfort that the impact may be limited.

Patrick Fearon, CFA
Vice President, Fund Management

              Mexican Consumer Confidence
    Seasonally-Adjusted, January 2003 = 100
                            Source:  INEGI
Consumer Confidence 1106

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