Jamie Spencer
Canadian retail sales experienced a 0.4% decline in February compared to January, totaling C$69.33 billion ($49.95 billion), according to Statistics Canada. The decrease was largely driven by lower sales at motor vehicle and parts dealers. However, a flash estimate indicates that retail sales likely rose by 0.7% in March, suggesting a potential recovery for the sector.
Sales Decline Across Key Sectors
In February, sales were down across four of nine subsectors, accounting for 43.1% of retail trade. In volume terms, retail sales also dropped by 0.4%, reflecting a slowdown in consumer spending. The decline was widespread, but some sectors, including automotive, saw significant reductions in sales. Despite this, the total year-over-year change for February was positive, with a 4.7% increase compared to February 2024.
Retail Sales Breakdown
In terms of monthly changes, retail sales in February saw a decrease of 0.4%, but excluding the automotive and parts sector, sales increased by 0.5%. The year-over-year comparison showed a healthier outlook, with a 4.9% rise in sales excluding autos and parts. These figures suggest that while the automotive sector struggled, other retail categories maintained stronger performance.
Impact of Tariffs and Economic Factors
Factors such as trade tariffs and overall economic uncertainty continue to impact consumer spending. As retailers grapple with fluctuating costs and evolving consumer behavior, the sector remains sensitive to both domestic and global economic trends. While February showed a slight decline, the forecasted growth in March provides optimism for the future of Canadian retail.
