Canadian wholesale sales climbed in January as higher receipts from computer and communications equipment countered declines in motor vehicles and parts.
Sales rose 0.8 percent to C$50.0 billion ($44.7 billion), Statistics Canada said today in Ottawa, matching the median forecast in a Bloomberg survey with 13 responses. The agency revised the December decline to 1.3 percent, from 1.4 percent initially.
Rising wholesale sales, along with yesterday’s report that factory shipments climbed 1.5 percent, suggest economic growth may be recovering from a slowdown late last year, curtailed by severe weather. The statistics agency, which reports January data on March 31, said last month Canada’s gross domestic product shrank 0.5 percent in December, the most in almost four years.
“The twin gains in sales and inventories bodes well for the contribution of the wholesale sector to January GDP,” Krishen Rangasamy, senior economist at National Bank Financial in Montreal, wrote in a note to clients.
Rangasamy predicts January GDP growth of 0.4 percent, “assuming a rebound in retail sales.” Statistics Canada will probably report a 0.7 percent increase in January retail sales on March 21, after the 1.8 percent drop in December, according to the median forecast of 20 economists in a Bloomberg survey.
Computer and communications equipment and supplies rose 6 percent in January to C$3.41 billion. Wholesale sales of motor vehicles and auto parts dropped 2.2 percent to C$8.15 billion, the fourth decline in five months, the agency said. Excluding motor vehicles, wholesale trade rose 1.4 percent.
The volume of wholesale sales, which removes the impact of price changes, gained 0.4 percent.
Inventories rose 1.4 percent to C$62.3 billion. The inventory-to-sales ratio, a measure of how many months it would take to deplete stocks at the current sales pace, climbed to 1.25 in January, from 1.24 in December.
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