FGV: Trade Confidence drops to 84.2 points in May compared to April

The Commerce Confidence Index (Icom) fell 2.0 points from April to May, to 84.2 points, the lowest level since March 2021, reported Fundação Getulio Vargas (FGV) this Thursday, 28. In quarterly moving averages, the Icom fell 1.0 point in May.

"Trade confidence fell again in May, reversing the positive movement observed in the previous month. The drop was influenced, mainly, by the return of assessments regarding the current moment to a negative scenario", Georgia Veloso, economist at the Brazilian Institute of Economics at FGV (Ibre/FGV), in an official note.

"Amid the worsening perception of current demand, expectations regarding future demand remained stable after three months of sharp declines, remaining in a pessimistic camp. As a result, the indicator reached the lowest level since March 2021, a period marked by the impacts of the second wave of Covid-19. This time, however, the weakening reflects the continuity of the unfavorable macroeconomic scenario for retail."

In May, there was a worsening of confidence in four of the six main segments of the sector.

The Current Situation Index (ISA-COM) fell 4.0 points, to 84.0 points. The Expectations Index (IE-COM) rose 0.1 point, to 85.2 points.

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Among the items that make up the IE-COM, the item that measures expectations about business trends decreased 0.3 points, to 84.2 points, and the forecast demand indicator grew 0.6 points, to 86.8 points.

In ISA-COM, the current demand volume item dropped 3.2 points, to 86.0 points, and the current business situation fell 4.7 points, to 82.4 points.

The May Trade Survey collected information between the 1st and 26th of the month.

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Source: CNN