Market Wire - Canadian Retail Sales Fall Less Than Expected
Karl Schamotta - Chief Market Strategist, firstname.lastname@example.org
Like their US counterparts, Canadian consumers front-loaded holiday purchases last year, with spending peaking in October as households heeded warnings of rising prices and product shortages to come. Data released by Statistics Canada this morning showed retail sales falling 1.8 percent month-over-month in December, aligning with consensus expectations for a 2.1 percent drop.
Sales at auto and parts dealers inched 0.5 percent higher, while gas stations recorded an 3.2 percent decrease. With those categories excluded, “core” sales tumbled 2.4 percent.
E-commerce sales plunged a seasonally-adjusted 10.3 percent month-over-month.
Overall retail sales were up 11.6 percent in 2021 from 2020’s levels, with gains at auto dealers and gas stations powering much of the gain.
Perhaps more critically for markets, an advance estimate showed retail sales rising 2.4 percent in January.
The loonie ticked slightly lower on the print, but remains up on the week.
Risk sentiment improved across financial markets earlier this morning on confirmation that Russian Foreign Minister Sergei Lavrov will discuss Moscow’s military buildup near Ukraine in talks with US Secretary of State Antony Blinken next week. Oil prices are down almost 2 percent, and safe haven currencies like the Swiss franc and Japanese yen are seeing lower demand.