Sharp jump in Mexico retail sales shows bright spot in weak economy

MEXICO CITY (Reuters) - Mexican retail sales rose 2.8% in May compared to a year ago, the national statistics agency said on Thursday, topping market expectations and an encouraging sign after weak recent data sparked recession fears for Latin America’s No. 2 economy.

The jump was the biggest registered since November 2018, the agency said. Sales increased 0.7% in May from April.

The preliminary estimate of Mexico’s gross domestic product for the second quarter will be released next week, after private economists warning that the biggest drop in industrial production in a decade in May risked dragging the economy into a second quarter of contraction.

On Tuesday, the Washington-based International Monetary Fund said it expected Mexico’s economy to grow 0.9% this year, lowering its forecast from 1.6% three months ago.

Reporting by Julia Love; Editing by Bernadette Baum and Tom Brown