UPDATE 2-Brazil May retail sales rise more than expected

(Adds segments for year-on-year expansion)

SAO PAULO, July 16 (Reuters) - Retail sales in Brazil rose more than expected in May from April, fueled by a decline in borrowing costs that made it cheaper for consumers to buy clothes, television sets and cars, government data showed on Monday.

Retail sales volumes rose 0.5 percent in May from April <BRRSL=ECI>, statistics agency IBGE said. The median forecast in a Reuters survey of 10 analysts was for retail sales to have been unchanged from April. The estimates ranged from a 2.1 percent drop in sales to a 0.8 percent rise.

Of the four sectors surveyed for the month-on-month data only the sector encompassing fuel and oil byproducts declined, posting a 1.2 percent drop from April.

Sales of textiles, clothing and shoes surged 7.6 percent from April as cheaper credit helped fuel Mother's Day sales, the IBGE said. Furniture and appliances sales rose 3.1 percent and supermarket, food, drinks and tobacco sales showed a 0.1 percent increase.

May retail sales volumes rose 10.5 percent when compared with a year earlier, the IBGE said. That was higher than the 8.15 percent median forecast of 16 analysts in the survey. The estimates ranged from 6 percent to 10 percent.

All eight segments surveyed for the year-on-year indicators rose, led by a 8.2 percent jump in supermarket, food, drinks and tobacco sales. Textiles and clothing sales climbed 16 percent and furniture and appliances sales rose 10.4 percent.

Nominal sales, as measured by total sales receipts and unadjusted for inflation, rose 1 percent in May versus April and 11.4 percent from April of last year.

Retail sales volumes, instead of total sales receipts via cash or credit card, exclude inflation that could distort sales comparisons.

For a breakdown of retail sales data from the IBGE's Web site please go to: here