Proactive Investors - Canadian retail sales increased 1.4% in January from the previous month to a seasonally-adjusted C$66.37 billion as consumer demand remained relatively strong in the face of a jump in interest rates over the last year.
That was stronger than Statistics Canada’s preliminary estimate last month for a rise of 0.7% on-month, after retail sales were downwardly revised to unchanged in December. Compared with a year earlier, sales were 5% higher in January.
Meanwhile, Statistics Canada provided an advance estimate of retail sales, which suggests that sales decreased 0.6% in February. Owing to its early nature, the figure will be revised.
Higher vehicle and parts sales
Sales increased in seven of nine subsectors, representing 88.7% of retail trade. January’s rise in retail sales was driven by a sixth consecutive monthly increase in motor vehicle and parts sales (+3.0%).
After the largest drop in five months in December, sales at gasoline stations and other fuel vendors also rose in February with a jump in gas prices (+2.9%), according to the national statistics office.
Canadian core retail sales, which exclude gas stations and motor-vehicle and parts dealers, were up 0.5% from December thanks largely to food and beverage retailers, the agency said.
Retail sales increased in all provinces in January. The largest provincial increase was observed in Alberta (+2.9%), led by higher sales at motor vehicle and parts dealers.
In Ontario, retail sales increased 0.7% in January, while retail sales were up 1.8% in British Columbia also led by motor vehicle and parts dealers.
On a seasonally-adjusted basis, retail e-commerce sales were down 0.1% to $3.3 billion in January.
The Bank of Canada earlier this month left its benchmark interest rate unchanged as it expects inflation to cool from last summer’s peak, though at 5.2% year-over-year in February it remains well above the central bank’s 2% target.