Mexico’s Consumer Confidence Index spiked sharply in July to its highest level in more than a decade, immediately after Andrés Manuel López Obrador — known as AMLO — won a landslide victory in the presidential election.

The index rose 14.8% last month, the National Statistics Institute (Inegi) said yesterday, to reach 101.7 points.

The figure was well above the 90.4 median forecast of eight analysts surveyed by news agency Bloomberg and the highest since March 2008 when it hit 102.3 points.

The only comparable surge in consumer confidence came in February last year when the index increased by just over 13%.

However, that result followed the so-called gasolinazo of January 2017 when fuel prices rose sharply to put a major dent in confidence.

“Consumers have definitely given a positive vote to the electoral results,” said Joan Enric Domene, an economist at the brokerage firm Invex Casa de Bolsa.

“People haven’t seen a substantial improvement in their quality of life yet, but they are happy with the outcome.”

The index was also up 17.8% compared to July last year.

The Inegi data is based on the National Consumer Confidence Survey that the institute carries out during the first 20 days of each month in conjunction with the Bank of México.

Confidence about Mexico’s economic outlook over the next 12 months increased by 31.9% compared to figures from the previous month, the biggest single-month jump recorded in the history of the survey.

Respondents’ confidence in their own purchasing power over the next year also increased, albeit by a lesser 11.3%.

The percentage of people who said they currently had plans to buy furniture, a television, a washing machine or another domestic appliance increased by13% compared to June figures.

The peso has also fared better since López Obrador’s election, appreciating 6.3% against the US dollar. A greenback currently buys just over 18.5 Mexican pesos.

Following his July 1 triumph, the president-elect and his prospective cabinet sought to calm fears surrounding the next government’s economic plans, a move which analysts believe has reassured investors and contributed to the peso’s strong performance.

Although household consumer confidence is up, Domene said that the same confidence hasn’t manifested itself in the business community.

“There are loose ends that the private sector is waiting to see tied up by this new government,” he said.

“Surely, in the next few months, investment from the private sector will be more reticent than consumer spending.”

López Obrador will take office for a six-year term on December 1.

Source: El Financiero (sp), Bloomberg (en)