Retail sales were up 4.8% to $55.1 billion in February. Sales increased in 9 of 11 subsectors, led by higher sales at motor-vehicle and parts dealers and gasoline stations. Core retail sales—which exclude gasoline stations and motor-vehicle and parts dealers—rose for the first time in three months, increasing 3.8% in February on higher sales at general merchandise stores and at clothing and clothing accessories stores. In volume terms, retail sales increased 4.3% in February.

Amid the ongoing COVID-19 pandemic in Canada, provincial governments continued to enact public-health measures in several regions across the country that directly affected the retail sector. Based on respondent feedback, approximately 12% of retailers were closed during February. The average length of the shutdown was two business days. 

Given the rapidly evolving economic situation, Statistics Canada is providing an advance estimate of retail sales, which suggests that sales increased 2.3% in March. Owing to its preliminary nature, this figure will be revised. 

TD Bank economist Ksenia Bushmeneva said retail sales rebounded in February, and likely in March, amid the easing of restrictions put in place to slow the spread of the pandemic. “Recent spending and mobility data suggests that retail sales are likely to weaken once again in April amid renewed restrictions and stay-at-home orders,” Bushmeneva wrote.

Core retail sales up on higher sales at general merchandise stores and non-essential retailers

After two consecutive months of declines, core retail sales increased 3.8% in February, led by higher sales at general merchandise stores (+6.1%). Clothing and clothing accessories stores also contributed to the increase in core retail, rising 23.7% in February—its first gain since September 2020. 

On the heels of two consecutive declines, sales increased at furniture and home furnishings stores (+18.0%) Electronics and appliances (+4.5%) and building materials, garden supplies & equipment (+3.5%), continued to benefit from the ongoing renovation boom and the strength in the real estate market. 

Sales up in six provinces

Sales were up in six provinces in February, with Quebec and Ontario leading the gain. In Quebec, sales rose by almost one-fifth in February (+19.0%)—their largest increase since June 2020. Motor-vehicle and parts dealers in the province reported higher sales, leading the gain amid the easing of COVID-19 restrictions in February. In the census metropolitan area (CMA) of Montréal, sales were up 20.4%. In Ontario, sales rose 2.3% on increased sales at gasoline stations and at clothing and clothing accessories stores. Sales fell 1.9% in the CMA of Toronto, coinciding with the continuation of COVID-19 lockdown restrictions in the region.

Retail e-commerce in Canada

On an unadjusted basis, retail e-commerce sales were up 92.0% year over year to $3.1 billion in February, accounting for 6.8% of total retail trade. The share of e-commerce out of total retail sales was 1.3% points lower in February, as more brick-and-mortar stores were allowed to open their doors to in-person shopping. On a seasonally adjusted basis, retail e-commerce fell 5.7% in February.

Source: TD
Source: Forex Live
Source: Globe and Mail
Source: Toronto Star
Source: Statistics Canada