Ottawa, July 19th, 2019—The Conference Board of Canada’s Senior Economist Christopher Heschl offers the following insights on today's release of data on retail trade:
“Following three consecutive increases, today’s Statistics Canada release showed retail sales declining by a slight 0.1 per cent in May. This comes on the heels of a slowdown in April that followed strong back-to-back gains in February and March. Poor weather triggered a 2.0 per cent drop in spending on food and beverages, a key catalyst of this month’s overall decline. After adjusting for inflation, total sales volumes were down 0.5 per cent over last month. This is part of a bigger picture of soft sales volumes, which have only risen by a modest 0.1 per cent since May 2017. On the plus side, solid job gains and steady wage growth over the last few months should help retail spending recover over the rest of 2019.”
- In May, retail sales logged its first decline since January, shrinking by a slight 0.1 per cent.
- Retail sales fell in 4 of 11 subsectors, with a 2.0 per cent decline in food and beverage sales making up the bulk of the total decline.
- Sales at cannabis stores continue to impress; they increased 14.5 per cent in May, marking the third month in a row of double-digit growth and are up 106.5 per cent since last October.
- Year-over-year, retail sales were up only 0.1 per cent.
- In volume terms, removing price changes, retail sales decreased by 0.5 per cent.
- Quebec and Ontario were the only two provinces to see a rise in retail sales.
- Retail sales continue to rise in Toronto and Montreal. Year-over-year retail sales rose by 6.0 per cent in Toronto and 5.2 per cent in Montreal, while Vancouver saw a decline of 0.5 per cent.
- Despite a strong year-over-year performance for Montreal in May, the Conference Board expects that a slower job market and softer after-tax income growth will cool retail sales growth in 2019.
- Overall, retail sales growth in Vancouver and Toronto in 2019 is anticipated to outpace 2018’s gains.