Market Wire - Canadian Consumer Spending Recovers
Karl Schamotta, Chief Market Strategist, email@example.com
Canadian consumer spending rebounded in January as Omicron-related restrictions were eased and households sought to get ahead of rising prices. Data released by Statistics Canada this morning showed retail sales surging 3.2 percent month-over-month in January, beating consensus expectations for a 2.4 percent gain.
Sales fell 1.7 percent month-over-month in December.
Sales at auto and parts dealers leapt 5.3 percent higher, while gas station receipts were roughly unchanged. With those categories excluded, “core” sales climbed 2.9 percent.
E-commerce receipts jumped a seasonally-adjusted 8.3 percent month-over-month.
Perhaps more critically for markets, an advance estimate showed retail sales falling 0.5 percent in February.
The loonie ticked slightly lower on the print, but remains up on the week. North American benchmark oil prices are back above the $100 mark after the Kremlin poured cold water on news of progress in peace negotiations with Ukraine.
10-year yields and the dollar are back to levels that prevailed ahead of Wednesday’s Federal Reserve meeting, and real rates - inflation breakevens subtracted from nominal rates - remain deeply negative, suggesting that central bankers are failing to achieve a desired tightening in financial conditions.