Brazil: Retail sales contract slightly in February

Retail sales (excluding cars and construction) fell 0.2% from the previous month in seasonally-adjusted terms in February, contrasting January’s revised 0.8% increase (previously reported: +0.9% month-on-month). February’s print fell short of market expectations of an 0.8% expansion.

Declines were seen in four of the eight components, with the largest drop in sales of clothing and footwear, while lower supermarket, food, beverages and tobacco sales—the sector with the most weight in the retail print— drove the downturn. Fuel prices recorded a fourth consecutive drop. Meanwhile, higher prices for furniture and books, newspapers, magazines and stationary partially offset the deterioration.

On an annual basis, retail sales increased 1.3% in February, easing from January’s 3.2% expansion. The print was the slowest pace in nearly a year. Nonetheless, the trend continued upward, and annual average growth came in at 2.8% in February (January: +2.5%), the highest figure in over three years.

Brazil Retail Sales Forecast

Panelists participating in this month’s LatinFocus Consensus Forecast expect retail sales to increase 3.3% in 2018, which is down 0.1 percentage points from last month’s forecast. For 2019, the panel sees retail sales growing 3.5%.