Surprise Retail Sales Gain Signals Canada Consumers Holding UpGreg Quinn
Canadian retail sales had a surprise gain in February with strength in most categories led by motor vehicle dealers, a sign of resilient consumer spending in an economy hobbled by a commodity crash.
Sales increased 0.4 percent to C$44.2 billion ($34.8 billion), Statistics Canada said Friday in Ottawa. None of the 18 economists in a Bloomberg News survey predicted the increase, and the median estimate was a 0.8 percent decline.
Motor vehicle and parts sales rose 1 percent to C$11.5 billion on the month, and have gained 15.3 percent over the last 12 months.
Gains came in nine of 11 major categories, including a 1.3 percent increase in the building material and garden equipment category.
Consumer finances are benefitting from lower gasoline prices. Receipts at filling stations dropped to the lowest since August 2010, with a 4.9 percent decline for February.
Household spending has remains a strong piece of Canada’s economic growth through a commodities crash. Low interest rates are supporting purchases of homes and cars, and the pain felt in Alberta’s oil patch from layoffs is being met with job gains in manufacturing-heavy regions such as Ontario.
The volume of sales rose 1.5 percent. That measure excludes the effects of price changes and more closely reflects the industry’s contribution to economic growth.