Brazil: Retail sales drop in February following sharp revision to January data
April 13, 2017
Brazilian retail sales (excluding cars and construction) fell in February, contrasting market expectations of 0.4% growth. Sales fell 0.2% from the previous month in seasonally-adjusted terms. The result contrasted January’s figure, which was revised sharply up from the previously reported 0.7% contraction to a robust 5.5% expansion. January’s figure marked a multi-year high and points to an improvement in household spending, suggesting that green shoots are emerging in the battered economy.
Looking at February’s result in detail, contractions were recorded in only three of the eight components of the index. The monthly drop was driven largely by a decline in sales of food, beverages and tobacco, the most significant category of the index.
On an annual basis, retail sales decreased 3.2% in February, which was a deterioration from January’s 1.2% decline. Despite the poor result, the trend inched up as the annual average variation in retail sales rose from minus 5.5% to minus 5.4%, a one-year high.