Total sales from Mexico’s major retail stores will likely surpass earlier estimates of nearly 7 percent growth this year, in large part due to abundant liquidity in the economy, the head of retailers association ANTAD said in an interview on Friday.
Earlier this year, ANTAD forecast annual growth of 6.9 percent for total retail sales, and 3.9 percent growth for sales at stores open at least a year.
Data through June already shows total sales growth of 10.1 percent and same-store sales growth of 6.8 percent, a trend that ANTAD President Vicente Yanez expects to continue through the remainder of the year.
“With more than half of the year behind us, there’s no doubt we will be ahead of the forecasts that were already good to begin with,” said Yanez.
“There’s abundant liquidity in the economy in all forms of purchase,” he said.
ANTAD includes retail chains Walmex (WALMEX.MX) and Soriana (SORIANAB.MX) as well as other department stores operating in Mexico, Latin America’s second-biggest economy behind Brazil.
Yanez said that better-than-expected sales growth is also due to an expansion in consumer credit.
Consumer finance in Mexico grew 11.2 percent year-on-year in June, with personal loans jumping 20.6 percent and credit for durable goods up 12.6 percent, according to data from Mexico’s central bank.
Bank data further shows that remittances sent home by Mexicans living abroad totaled $13.16 billion during January to June, up nearly 9 percent over the same period in 2015.
Yanez said lower-income sectors of the economy will benefit the most from the growth in remittances, which is also being boosted by the deprecation of the Mexican peso since last year.
“This provides a significant flow of resources in pesos which stimulates commerce in general,” he said.
The Mexican peso has weakened 8.8 percent so far this year, following a 17 percent depreciation in 2015.