Mexico Consumer Confidence Tops Forecasts as AMLO Takes Over

(Bloomberg) -- Mexico consumer confidence soared beyond all economist estimates in December after President Andres Manuel Lopez Obrador took office vowing to make the economy grow faster, curtail surging violence and root out corruption.

Key Points

  • Index climbed to 108.6 in non-seasonally adjusted terms, the highest since 2006, from 100.9 the previous month, the national statistics institute reported on Thursday.
  • Economists had expected it to rise to 101.8, based on the median forecast in a Bloomberg survey.
  • Indicator for respondents’ views on the state of the national economy in the next year showed the biggest increase in seasonally adjusted terms, rising to 55.8, up 6.6 percentage points from November and 22.6 percentage points from a year ago.
  • The surge in consumer confidence comes despite inflation that accelerated to nearly 5 percent in December, the peso’s tumble to an almost six-month low and a benchmark interest rate that’s the highest in a decade.
Mexico Consumer Confidence Tops Forecasts as AMLO Takes Over

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  • Indicator for respondents’ expectations about their family’s economic situation in a year from now, compared with the current situation, rose to 58, up 3.5 percentage points from November and 8.6 percentage points from a year ago.
  • Indicator for views about their family’s current economic situation, compared to a year ago, rose to 47.2, up 0.9 percentage point from November and 2.5 percentage points from a year ago.
  • Views on the possibility that households buy big-ticket items like furniture or electronic appliances also rose.

What our economist says....

“Results are consistent with robust labor market conditions and hopes about promises made by AMLO. They show little drag from higher inflation or higher interest rates, and support expectations for resilient private consumption to continue rising and sustain positive economic growth.”
-- Felipe Hernandez

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