Consumer confidence increased in November compared to the previous month, but remains well below the level recorded a year earlier.

Data published by the national statistics agency INEGI on Monday showed that Mexico’s consumer confidence index (ICC) rose 0.6 points compared to October to 41.7 points. The month-over-month increase was the best since November 2021.

However, the latest ICC score is still 4.2 points lower than that recorded in November 2021, INEGI said. That’s the largest year-over-year decline since February 2021, the newspaper El Financiero reported.

The statistics agency conducted its consumer confidence national survey at 2,336 homes in cities across all 32 federal entities.

It asked respondents about:

• Their current economic situation compared to a year earlier.
• Their expected economic situation over the next 12 months.
• Their opinion about Mexico’s current economic situation compared to 12 months earlier.
• Their opinion about Mexico’s expected economic situation over the next 12 months.
• Their current capacity to purchase furniture, a television, a washing machine and other home appliances compared to their capacity 12 months earlier.

Their responses were weighted and used to formulate the ICC score. A score below 50 indicates pessimism among consumers.

The 0.6-point month-over-month improvement in consumer confidence coincided with a slight easing of Mexico’s annual headline inflation rate, which dropped to 8.14% in the first half of November.

It came after strong formal sector job creation in October, with over 200,000 new positions added, and at a time when the Mexican peso was performing well against the U.S. dollar.

However, the prevailing pessimism among consumers is indicative of broader economic uncertainty as the world braces for a possible global recession in 2023.

The biggest driver of the 0.6-point month-over-month increase was a 1.4-point improvement in the sub-index that measures perceptions about the national economy compared to a year earlier.

The respondents were surveyed in a three-week period in November just after INEGI published preliminary data that showed that Mexico’s gross domestic product increased 4.3% in the third quarter of 2022 compared to the same period of last year.

The only sub-index that declined on a month-over-month basis was that which measures respondents’ expectations about their own economic situation over the next 12 months. That indicator fell 0.1 points to 54.3.

The sub-index that measures respondents’ capacity to make a significant household purchase rose 0.1 points to 23.6

Janneth Quiroz, an economist with the Monex financial group, said on Twitter Monday that “consumers are facing greater pressures due to inflationary pressures.”

“Within the complementary indicators of the consumer confidence [index], that which fell the most in November compared to a year ago was that concerning [the capacity] to buy clothes, shoes, food, etc.,” she wrote.

“While consumer confidence recovered … in November compared to the previous month, it has remained at low levels since the start of 2021,” Quiroz said in another tweet.

With reports from El Financiero, La Jornada and El Economista