Black Friday Fuels Surprise Surge in Brazilian Retail Sales

  • November sales rose 1.5% on gains in furniture and applicances
  • Median forecast of analysts was 0.8% monthly decline

Brazil’s retail sales rose in November as shoppers took advantage of holiday specials, surprising analysts who forecast a decline while offering a rare reason to celebrate in an otherwise battered economy.

Sales surged 1.5 percent from the prior month, the biggest gain in a year, the national statistics agency said Wednesday. That compares with analyst estimates for a 0.8 percent decline following a revised increase of 0.5 percent in October.

Two straight months of rising retail sales may give the central bank additional freedom to raise borrowing costs next week, as it struggles to contain above-target inflation without crimping gross domestic product. Still, economists said they weren’t convinced the data represent a turning point in an economy that shrank in the first three quarters of last year.

Wednesday’s numbers “might help to reduce the pace of the drop in GDP in the fourth quarter, but of course we have to wait for December figures,” said Luciano Rostagno, chief strategist at Banco Mizuho do Brasil.

The statistics institute said Brazilians may have been getting an early jump on their holiday purchases in November. Economists including Newton Rosa at Sul America Investimentos and Thais Zara at Rosenberg Consultores Associados said shoppers took advantage of Black Friday deals, which have become ubiquitous in the Latin American country.

Sales of furniture and appliances increased 6.9 percent, offsetting a 1.5 percent decline in food, beverages and tobacco products at hypermarkets and supermarkets. The sales of items for personal and domestic use jumped 4.1 percent.

"What surprised at the margin was growth of furniture, appliances and segments more tied to credit, and I think they benefited from Black Friday,” Rosa said. "This doesn’t change the outlook for a slowdown in retail, which will continue showing itself in coming months.”

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