Mexican retail sales fell in January by a seasonally-adjusted
0.3%, after a revised December decline of 2.3%. That marked
the first back-to-back sales declines since last summer. On
an unadjusted, constant-price basis, sales in January were also
down 0.3% from the same month one year earlier. The retail
subsectors posting year-over-year declines in January were
department stores and shops specializing in home decor, domestic
appliances, and computers. In contrast, the retail subsectors
posting year-over-year increases were healthcare; metal and glass
products; recreational, paper, and personal products; clothing,
footwear, and textile goods; motor vehicles, fuels, and lubricants;
and food and beverages.
At the wholesale level, January sales fell 0.5%, reversing part
of their 2.4% jump in December. Wholesale receipts in January
were up 1.1% year-over-year.
The report was released on Friday by INEGI, the official
Comment: As I feared after the
December sales report last month, it is beginning to look like
Mexican consumption demand will remain weak in early 2014.
Late last autumn, sales got a boost from dramatic sales promotions
and a rush by consumers to make purchases ahead of sales tax
increases that took effect on January 1. Now, that dynamic
has petered out. It seems that consumers are once again
focused on the lack of meaningful improvement in the labor market
and the increased cost of living. Weak consumption demand
will probably continue to be a headwind for Mexico's overall
economic growth in the near term.
Patrick Fearon, CFA
Vice President, Fund Management
Mexican Retail Sales
Adjusted, 2003 = 100
Mexican Wholesale Sales
Seasonally Adjusted, 2003 = 100