Retail Sales Show No Growth in December

The Conference Board of Canada’s Economist Richard Forbes offers the following insights on today's release of data on retail trade:

Today’s Statistics Canada release showed that retail sales were flat in December. Retail sales increased just 1.6 per cent last year, the weakest annual gain in a decade. The release reinforces our forecast that consumer spending will remain modest this year

  • Retail sales were flat in December after a 1.1 per cent gain in November.
  • Sales rose in 7 of 11 subsectors. The largest gains were at building materials stores, where sales increased by 3.8 per cent.
  • Outside of the income tax increase, there were no other significant tax measures in Budget 2020.
  • In total, retail sales were up 1.6 per cent in 2019. This was the weakest annual gain in retail sales since the financial crisis in 2009.
  • After taking into account price changes, total sales volumes edged up just 0.1 per cent last year.
  • Sales rose in eight provinces, with Saskatchewan and Alberta posing the largest gains. Meanwhile, sales fell in Quebec and New Brunswick following healthy gains in November.
  • On an annual basis, sales increased 2.8 per cent in Ontario, behind only P.E.I. The strong gains reflected the province’s hot labour market.
  • Looking ahead, consumer spending is anticipated to expand at a modest pace this year. Slower gains in household disposable income, and a rising household savings rate are key factors weighing on our outlook.

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Anna Feng

Richard Forbes

Economist, Industrial Outlook, Trade and Investment
The Conference Board of Canada