Trade in Mexico contracted in the first half of 2024, with the greatest signs of weakness seen in online sales, in self-service stores, and in the purchase of household goods.
Retail sales in June had their second consecutive monthly decline and the first in their annual measurement, after four upward readings, the National Institute of Statistics and Geography (Inegi) announced.
According to the Monthly Survey of Commercial Enterprises, calculated by Inegi, real income from retail sales, the main indicator of household consumption, fell 0.5 percent in June compared to the previous month, with figures adjusted for seasonality; meanwhile, compared to the sixth month of 2023, they contracted 2.8 percent, the worst drop since December 2020; while the annual decline was 3.9 percent annually with original figures.
The official data from Inegi deviate from the forecasts released by Citibanamex’s economic analysis department, which expected monthly retail sales growth of 0.4 percent and a drop of 2.1 percent in June compared to the same month in 2023.
Analysts at the financial firm had expected retail sales to continue to lose momentum – as well as private consumption – to accumulate annual growth of 0.8 percent in 2024, well below the 3.6 percent in 2023.
Retail sales fell by 0.3 percent in the first half of 2024.
According to original figures, the decline was 3.9 percent year-on-year in June, affected by the collapse in online sales (-10.8 percent), household goods (-2.6 percent) and self-service stores (-5.2 percent). However, practically all subsectors showed declines.
“The reading of deceleration and weakness in demand in the short term was strengthened. In addition, it leaves more signs of a pronounced cooling of consumption, since retail sales reached minimum levels not registered since January. Particularly surprising was the double-digit decline in the hardware (-10.8 percent annually) and entertainment (-13.2 percent) sectors.
In the future, a key factor will be the inflationary dynamics, since prices have accumulated five months of increases, which could undermine consumption and buyer confidence, which is why we expect a greater moderation of retail sales for the following months.
said Janneth Quiroz, director of economic, foreign exchange and stock market analysis at Monex.
Meanwhile, revenue from the provision of non-financial private services rose in June, supporting the growth of the Mexican economy, according to Inegi.
According to the Monthly Survey of Non-Financial Private Services, conducted each month by Inegi, real income from the provision of non-financial private services increased 0.3 percent in June, its fifth consecutive monthly increase, reflecting a clear upward trend, rising 6.2 percent annually in June, making it the most dynamic sector of the Mexican economy in the first half of the year.
For the first half of 2024, service revenue increased 4.8 percent annually with original figures.
This Thursday, Inegi will release the final GDP figures for the second quarter of 2024 and will incorporate all this information.
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– 2024-08-30 13:41:19
