Brazil's retail sales drop as job cuts take toll on spending

Brazil's retail sales fell more than expected in March as a surge in unemployment hurt supermarkets and food vendors, frustrating hopes that consumer spending was stabilising after dropping sharply during the country's deep recession. Retail sales volumes excluding cars and building materials in Brazil fell 0.9 percent in March from February, government statistics agency IBGE said on Wednesday. Economists in a Reuters poll expected a decrease of 0.5 percent.
Sales fell 5.7 percent from the year-earlier period, compared to expectations for a 4.5 percent drop. It was the 12th consecutive year-on-year fall in monthly retail sales as Brazil slipped into its worst recession in decades. A broader retail index that includes cars and building materials declined 1.1 percent from February, IBGE said. Sales dropped in six of the eight retail sectors covered by the IBGE survey. Supermarket and food sales, the most important component of IBGE's retail index, dropped 1.7 percent as more than 100,000 Brazilians lost their jobs in March. Apparel sales fell 3.6 percent, IBGE said. Sales rose an unexpected 1.1 percent in February amid signs that a decline in consumer confidence had been halted. But sentiment slipped again in March and fell to a record low in April.