Summary
Retail sales performance surprisingly exceeded market expectations in June, showing stability at the margin (vs -0.2%), while broad retail sales advanced 1.2% MoM (-0.3%)
Positive Highlights
– Fabric, clothing, and footwear (1.4%)
– Hypermarkets, supermarkets, food products, beverages, and tobacco (1.3%)
– Books, newspapers, magazines, and stationery (1.2%)
– Furniture and appliances (0.8%)
– Activity of Vehicles and motorcycles, parts, and pieces (8.5%)
Negative Highlights
– Other personal and household items (-0.9%)
– Pharmaceuticals, medical, orthopedic, and perfumery showed growth (-0.7%)
– Fuels and lubricants (-0.6%)
– Construction materials (-0.3%)
View
The positive surprise in broad retail data is attributed to the strong vehicle sales, driven by federal policy promoting vehicle consumption, with discounts. However, excluding this impact, we observe retail stability, in line with our expectations of a modest activity in the short term. We highlight that we might see a better retail sector outlook due to “Desenrola”, which manages to remove from the negative register those with smaller debt, resulting in some moderate consumption growth.
