Brazil: A hangover from the Black Friday - Rabobank

Sandeep Kanihama FXStreet Contributor

Analysts at Rabobank note that Brazil’s headline retail sales (i.e. “varejo ampliado”) fell 1.7% m/m (+1.8% y/y) in December, disappointing the consensus (-0.7%; 4.0%) and Rabobank’s own estimate (+1.6%; 7.4%).

Key Quotes

“The result seems to have been influenced by a payback to strong Black Friday sales in November – an effect that our models (clearly) failed to capture.”

“Despite the influence from recent shocks (e.g. truckers’ strike in May; one-off transfers in Q3), the trends point to continued expansion in goods consumption. In Q4, the broad retail sales index rose at a sequential annualized speed of 1.3% (Q3: 7.6%); in 18H2, broad sales moved at a sequential annualized pace of 4.5% (18H1: 4.2%).”

“The much lower than expected retail sales performance prompted us to revise down our projections for December IBC-Br index (out on Friday). We now look for a stable year-on-year print (previous: +0.9%), and a sequential decline of 0.1% m/m (previous: +0.3%).”

Author

Sandeep Kanihama

FXStreet Contributor

Sandeep Kanihama is an FX Editor and Analyst with FXstreet having principally focus area on Asia and European markets with commodity, currency and equities coverage. He is stationed in the Indian capital city of Delhi.

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