Consumer confidence in Colombia deteriorates in June due to unemployment

This confidence is shown as a reflection that the economy is recovering slower than expected

Women at a supermarket / Imagen de Referencia / Pexels

Reuters | Carlos Vargas

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Consumer confidence in Colombia deteriorated in June due to the rising unemployment, a survey revealed on Wednesday, reflecting that the economy is recovering slower than expected.

Leer en español: Confianza de consumidores en Colombia se deteriora en junio por desempleo

The Consumer Confidence Index (ICC) of the economic studies firm Fedesarrollo fell to 6.3% in the sixth month of the year, more than the 5% it did in May and the positive variation of 15.5% that reported in June of last year.

The indicator collects the expectations of households up to the next year, as well as the perception of consumers about the current economic situation.

"We were waiting from Fedesarrollo in front of the signals that we have seen of leading indicators, an increase in confidence, this increase is not happening yet, (…) the news is not favorable," the director of the center of investigations, Luis Fernando Mejía, told reporters. 

"Surely the most important issue that is affecting the pockets of households has to do with unemployment," he added.

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The deterioration in consumer confidence contrasts with the dynamism of retail trade, with sales up 8.2% year-on-year in May.

The fourth economy in Latin America registered urban unemployment of 11.2% in May, higher than 10.1% in the same month in 2018.

According to the latest Reuters poll, the Colombian economy would expand 3.15% this year, below the government's target of 3.6%, although better than the 2.6% reached in 2018.