January 23, 2019 / 5:50 PM / a month ago

UPDATE 2-Mexican retail group projects sales to fall in 2019

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MEXICO CITY, Jan 23 (Reuters) - The Mexican retailers association ANTAD on Wednesday estimated that sales at stores open for at least a year would fall by 1 percent this year compared with 2018, blaming economic uncertainty and crime for the gloomy outlook.

The group, which includes retail chains such as Wal-Mart de Mexico and Soriana, said same-store sales were nearly flat last year, slightly missing a growth forecast of 1.3 percent, when adjusted for inflation, because of crime and weak demand.

The group did not explain why demand had been weak in an election year, when campaign spending is generally believed to support consumer spending.

However, ANTAD’s economic studies manager, Juan Pablo Flores, said consumer confidence had generally dragged before picking up over the last three months of 2018.

When asked how crime had dampened sales, ANTAD’s executive president, Vicente Yanez, said stores in hard-hit areas, including Tamaulipas state where dueling drug gangs have caused a surge in violence, reduced their hours for lack of shoppers at night.

“Because of the perceptions and realities of safety, people limit their shopping outings to certain hours,” he said.

The forecast comes as Mexico’s new leftist government plans to channel more of the budget to social spending.

Flores said the estimate is in line with forecasts for Mexico’s economy overall, which the International Monetary Fund expects will see a drop in private investment.

The group said same-store sales fell 1.3 percent in December and edged up 0.1 percent during all of 2018, when adjusted for inflation. (Reporting by Daina Beth Solomon; Editing by Jeffrey Benkoe and Sandra Maler)

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