MEXICO CITY, Dec 4 (Reuters) - Mexico's consumer confidence index rose slightly to 78.2 in November as the battered economy showed signs of stabilizing, the national statistics agency said on Friday.
In a Reuters poll of analysts and economists, the median estimate was 79.0.
Mexico's economy began to emerge from a deep recession at the end of the summer, but higher taxes next year and bloated unemployment rolls are expected to keep any recovery muted.
'There are new taxes coming -- for telephone, gasoline, home sales, light -- and the salaries are very low,' said Sagrario Luna Alzarez as she left a shopping center in the toney Polanco neighborhood of Mexico City. 'From January, we are going to have to pay more taxes that we had not been expecting.'
In October, Mexican lawmakers approved a new consumption tax that aims to boost government revenue hit hard by the economic downturn and waning oil resources. The central bank has said the new taxes should only have a 'one-time' impact on prices and that it will be vigilant against inflation.
'While employment has made a slight improvement, the levels are still high,' said Arturo Vieyra Fernandez, an economist with Banamex. 'Employment is a fundamental part of confidence. As we see an improvement in employment, we will also see an increase in confidence.'
Alonso Cervera, an economist with Credit Suisse, said Mexicans were right to view the economy as weak but that many have an overly-bleak attitude about the future.
'Nearly 90 percent of Mexicans think the economy is worse now than a year ago and they're probably right,' he said, citing research from the Consulta Mitofsky polling firm. 'But that same report said nearly 80 percent of people expect things to be just as bad next year. I find that hard to believe.'
Cervera said that he will be watching the confidence number but it will not change his overall forecasts, in part, because the data series is not even nine years old.
As a result, economists cannot compare current readings to Mexico's mid-1990s financial meltdown, known as 'the Tequila Crisis.'
'We don't know what the reading would have been during the Tequila Crisis,' he said.
((Reporting by Patrick Rucker, Editing by Gary Crosse)) Keywords: MEXICO ECONOMY/CONFIDENCE (patrick.rucker@thomsonreuters.com; +5255-5282-7163; Reuters Messaging: patrick.rucker.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2009. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
In a Reuters poll of analysts and economists, the median estimate was 79.0.
Mexico's economy began to emerge from a deep recession at the end of the summer, but higher taxes next year and bloated unemployment rolls are expected to keep any recovery muted.
'There are new taxes coming -- for telephone, gasoline, home sales, light -- and the salaries are very low,' said Sagrario Luna Alzarez as she left a shopping center in the toney Polanco neighborhood of Mexico City. 'From January, we are going to have to pay more taxes that we had not been expecting.'
In October, Mexican lawmakers approved a new consumption tax that aims to boost government revenue hit hard by the economic downturn and waning oil resources. The central bank has said the new taxes should only have a 'one-time' impact on prices and that it will be vigilant against inflation.
'While employment has made a slight improvement, the levels are still high,' said Arturo Vieyra Fernandez, an economist with Banamex. 'Employment is a fundamental part of confidence. As we see an improvement in employment, we will also see an increase in confidence.'
Alonso Cervera, an economist with Credit Suisse, said Mexicans were right to view the economy as weak but that many have an overly-bleak attitude about the future.
'Nearly 90 percent of Mexicans think the economy is worse now than a year ago and they're probably right,' he said, citing research from the Consulta Mitofsky polling firm. 'But that same report said nearly 80 percent of people expect things to be just as bad next year. I find that hard to believe.'
Cervera said that he will be watching the confidence number but it will not change his overall forecasts, in part, because the data series is not even nine years old.
As a result, economists cannot compare current readings to Mexico's mid-1990s financial meltdown, known as 'the Tequila Crisis.'
'We don't know what the reading would have been during the Tequila Crisis,' he said.
((Reporting by Patrick Rucker, Editing by Gary Crosse)) Keywords: MEXICO ECONOMY/CONFIDENCE (patrick.rucker@thomsonreuters.com; +5255-5282-7163; Reuters Messaging: patrick.rucker.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2009. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.