Retail sales up 0.3% in December -IBGE

Retail sales in December rose a seasonally adjusted 0.3% from November, the Brazilian Census Bureau (IBGE) said Tuesday. December sales surged 6.7% from December 2010. Retail sales ended 2011 with growth of 6.7% compared with growth of 10.9% in 2010.

Record-low unemployment, higher salaries and greater access to credit fueled domestic consumption throughout 2011, offsetting concerns that Europe's ongoing debt crisis and a slowing global economy could affect Brazil. Consumers benefited from an interest rate cutting cycle implemented by the Brazilian Central Bank in August, while the government also cut taxes on domestic goods such as refrigerators and stoves in December.
   
Retail sales growth, however, fell short of 2010's advance because of inflation concerns that weighed heavily on Brazil to start 2011. The Central Bank raised rates at its first five meetings of the year amid a surge in prices before abruptly shifting course in August as the crisis in Europe deepened.
   
December's retail sales were led higher by gains in seven of the 10 categories measured by the sales survey, including a 6.9% month-on-month jump in sales of office, technology and communications equipment. Furniture and household appliances climbed 2.6%. Supermarket sales, which include the food, beverage and tobacco segments, slid 1.5% month-on-month in December.
     
In 2011, sales of furniture and household appliances led all categories, soaring 16.6%, the IBGE said. Hypermarket and supermarket sales also recorded 4.0% growth during the year, while sales of pharmaceuticals, medical products and perfumes advanced 9.7% in 2011.