Quotes from Barclays Capital:- Mexico's retail sales increased 5.6% y/y in October, surprising the market on the upside. Nevertheless, they contracted 0.1% m/m sa at the margin, very close to what we estimated (0.0%), and with mixed results: within the headline index, hardware, paper and entertainment, internet and supermarket sales posted positive increments, offset by domestic equipment, apparel and healthcare sales.- The report suggests that the domestic market remains fragile and with no clear signs of recovery. Private consumption contracted in August and September (-0.2% and -0.6% m/m sa, respectively) and this trend might continue in October. – In that sense, the fragility of the domestic market implies that Banxico will not increase the interest rate in the near future, even with persistent volatility in the MXN, as the stalled consumption should keep inflation contained.
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