MexECON Blog

March Retail Sales Fall 0.5 Percent

Mexico's March retail sales fell by a seasonally-adjusted 0.5%, after an increase of 0.2% in February and a revised increase of 0.8% in January.  Without seasonal adjustments, but stripping out the impact of price increases, sales in March were up 4.3% from the same month one year earlier.  The retail subsectors posting the best year-over-year increases in March were department stores; metal and glass products; paper and personal products; healthcare; and food and beverages.  The report was released on Tuesday by INEGI, the official statistics agency.

Comment:  Not only was the March decline in retail sales only modest, but other recent data suggests it will be reversed in the coming months.  Mexican exports have recently been reaccelerating, and in March, Mexico saw a rise in industrial production, a decline in unemployment, and an increase in consumer optimism.  With those positive dynamics in place, it seems reasonable to expect Mexican retail sales to resume their upward trend in April or May.  In recent quarters, consumption spending has been a key source of Mexican economic growth, so if retail sales do resume their upward trend, it should help keep the Mexican expansion moving forward.

Patrick Fearon, CFA
Vice President, Fund Management

                                                  Mexican Retail Sales
                                      Seasonally Adjusted, 2003 = 100
                                                    Source:  INEGI
Retail Sales 1203

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