RIO DE JANEIRO, March 30 (Reuters) - Retail sales in Brazil fell unexpectedly in Brazil in January, in another signal that the economic recovery expected to start this year could be weaker than expected.
Retail sales volumes excluding cars and building materials in Brazil fell 0.7 percent in January from December, government statistics agency IBGE said on Thursday.
Economists in a Reuters poll expected a rise of 0.6 percent.
Sales plunged 7 percent from January 2016, compared with expectations for a 4.15 percent drop in the Reuters poll.
Brazil’s economy is widely expected to start recovering this year from its worst recession on record. Industrial output has improved, as expected, but services activity fell at a record speed in January, data showed earlier this month.
Retailers and service providers have struggled with record-high unemployment and interest rates that still rank among the highest in the world. The central bank expects commerce to grow just 0.7 percent this year after a 6.3-percent drop in 2016, according to estimates published earlier on Thursday.
An index measuring inventories at retailers operating in Brazil’s largest city, São Paulo, rose in March as weak economic growth continued to hamper consumption, industry group Fecomércio-SP said earlier this week.
A broader retail measure that includes sales of cars and building materials, which are considered to be more volatile, fell 0.2 percent in January from December, IBGE said. (Reporting by Rodrigo Viga Gaier; Writing by Silvio Cascione; Editing by W Simon and Bernadette Baum)