Canada February Retail Sales - Slippage from strong December continues, but March seen firmer
Canada’s February retail sales with a 0.4% decline are in line with a preliminary estimate made with January’s data but saw a stronger than expected 0.5% increase ex autos. Despite growing downside economic risks, the preliminary estimate for March is surprisingly positive, with a rise of 0.7%.
February’s decline is the second straight but does not fully erase a strong rise in December. A sales tax holiday was introduced in mid-December and persisted through mid-February.
In volume terms, February retail sales matched the 0.4% decline in value, while sales were up 0.5% excluding autos and gasoline as well as excluding only autos.
Retail sales trend started 2024 weak but has since picked up supported by BoC easing. Given the positive preliminary estimate for March the picture still looks healthy entering 2025 but this will be difficult to sustain once tariffs bite.
