Private consumption persisted in its downward trajectory in May, contracting by 0.3% month-on-month and 2.2% year-on-year, marking the sixth consecutive annual decline, as reported. In the first five months of 2026, the total decrease was 1.8%. In this context, supermarkets and wholesale retailers have identified inadequate demand as the primary obstacle to expanding their operations, as reported by the source. Mass consumption continues to decline, with beef sales leading the trend, having contracted for 10 consecutive months and registering a 13% year-on-year decrease in April. In April, poultry sales saw a decrease of 2.5%, while pork sales exhibited a significant rise, increasing by 6.2% year-on-year and 11% in the first four months of the year.
On Thursday, INDEC reported that 62.6% of supermarkets and wholesale stores recognised demand as the main limitation on commercial activity. This concern has intensified over the past three months, when the figure was recorded at 54.5%. The diagnosis is similarly evident in the perception of the current situation. A third of the firms (33%) assessed their business situation as “bad,” whereas merely 6.6% deemed it “good.” The balance between positive and negative responses resulted in a net decline of -26.4%. Business owners display a tempered optimism about the future, although they do not foresee a significant recovery. While 18.7% of respondents believe that business conditions will improve during the June-August quarter, 12.1% anticipate a deterioration, and nearly 70% of companies expect the situation to remain stable.
Household spending indicators monitored by the UP reveal further signs of a deceleration. In May, real VAT collection recorded a year-on-year decline of 3%, whereas credit card purchases experienced a real decrease of 3.5%. This signifies the inaugural decrease in credit card transactions since the resurgence began after the economic downturn of 2024. The durable goods sector demonstrated a mixed performance, as motorcycle registrations rose by 26% year-on-year in May, despite a deceleration in the growth rate. Automobile registrations, in contrast, experienced a decline of 26.2% relative to May 2025, marking their fourth decrease of the year. Bagged cement shipments, an indicator linked to small-scale construction activity, saw a reduction of 8.3% in May, contributing to a cumulative decline of 8.9% for the year 2026 thus far. Recreation and tourism showed signs of a decline after a brief period of growth in the first two months of the year. In April, year-on-year consumption in traditional restaurants in Buenos Aires City registered a decrease of 2.9%. Meanwhile, March experienced a notable decline in cinema attendance and food court consumption in shopping centers, with both metrics decreasing by approximately 20%.
According to the INDEC survey, only 2.2% of supermarkets anticipate an increase in the volume of orders placed with suppliers in the next three months. In contrast, 15.4% anticipate a reduction in their orders, while a significant 82.4% foresee that order volumes will remain stable. Employment prospects show limited signs of expansion. Only 1.1% of companies anticipate increasing their workforce, while 18.7% predict reductions in their staff levels. Against this backdrop, the sector’s business confidence indicator remained in negative territory at -4%, indicating that improving expectations have yet to offset the weakness companies are currently experiencing.