Canada: Retail trade, December 2018

Retail sales edged down 0.1% to $50.4 billion in December. Lower sales at gasoline stations (-3.6%) were partly offset by higher sales at motor vehicle and parts dealers (+1.0%). Excluding gasoline stations, retail sales increased 0.4%.

After removing the effects of price changes, retail sales in volume terms increased 0.2%.

Retail sales declined 0.5% in the fourth quarter of 2018, following a 0.7% increase in the third quarter. In volume terms, retail sales were relatively unchanged in the fourth quarter.

Retail sales in 2018 totalled $605 billion, up 2.7% from 2017.

Lower sales at gasoline stations

Sales at gasoline stations (-3.6%) declined for the second month in a row in December, largely due to lower prices at the pump. In volume terms, sales decreased 0.3%.

Following a 2.1% gain in November, sales at electronics and appliance stores decreased 4.0% in December.

Sales at motor vehicle and parts dealers (+1.0%) increased for the fourth time in five months, led by higher sales at new car dealers (+1.2%).

Receipts at food and beverage stores (+0.9%) were up for the third time in four months, on the strength of higher sales at supermarkets and other grocery stores (+1.2%).

Building material and garden equipment and supplies dealers (+3.1%) reported their first increase in six months.

Sales down in four provinces

In Ontario (-0.5%), retail sales were down for the second month in a row, mainly due to lower sales at gasoline stations. Sales in the census metropolitan area (CMA) of Toronto decreased 0.9%.

Retail sales in Quebec decreased by 0.2% on lower sales at motor vehicle and parts dealers and sporting goods, hobby, book and music stores. Sales in the CMA of Montréal were up 0.6%.

Following a weather related 5.7% decline in November, sales in Nova Scotia increased 5.2% in December.

Sales in Manitoba (+1.3%) increased for the first time in three months, on the strength of higher sales at motor vehicle and parts dealers.

E-commerce sales by Canadian retailers

The figures in the sections below are based on unadjusted (that is, not seasonally adjusted) estimates.

On an unadjusted basis, retail e-commerce sales were $2.0 billion in December, accounting for 3.7% of total retail trade. On a year-over-year basis, retail e-commerce increased 4.6% in December, while total unadjusted retail sales decreased 0.4%.

Retail sales in 2018

Canadian store retailers generated sales of $605 billion in 2018, up 2.7% from 2017. The increase was largely attributable to higher prices, as sales in volume terms were up 0.7%. Provincially, retail sales were up in eight provinces, with Ontario (+3.9%) leading the way. Following declines in 2015 and 2016, retail sales in Alberta (+1.7%) rose for the second year in a row.

Gasoline stations lead increase

Higher prices at the pump were the main contributor to the 7.9% gain at gasoline stations. Removing the effects of price changes, sales at gasoline stations in volume terms were down 3.2%. According to the Consumer Price Index, the annual average price of gasoline was 12.6% higher in 2018 than in 2017.

After a record setting year in 2017, when over two million new motor vehicles were sold, unit sales of new motor vehicles were down 2.0% in 2018. The decrease in units came from lower sales of passenger cars (-10.6%), which more than offset higher sales of trucks (+1.9%).

Receipts at food and beverage stores rose 1.9%, with gains reported in every province in 2018.

Cannabis stores enter retail landscape

Following the legalization of cannabis in October 2018, retail sales at cannabis stores totalled $151.5 million in the fourth quarter. Differences in retail structures in each province and territory affected the availability of cannabis products across the country.

Online sales continue to grow

Retail e-commerce, including sales from both store and non-store retailers, rose 14.7% to $18.0 billion in 2018. Retail e-commerce represented 2.9% of total retail sales, compared with 2.6% in 2017. During the November and December holiday shopping season, retail e-commerce accounted for 3.9% of total retail sales, up from 3.5% in 2017, in part due to strong retail e-commerce sales in November 2018. Approximately one-quarter of retail e-commerce sales took place during the 2018 holiday shopping season.

StatsCanada

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Dean Popplewell

Dean Popplewell

Vice-President of Market Analysis at MarketPulse
Dean Popplewell has nearly two decades of experience trading currencies and fixed income instruments. He has a deep understanding of market fundamentals and the impact of global events on capital markets. He is respected among professional traders for his skilled analysis and career history as global head of trading for firms such as Scotia Capital and BMO Nesbitt Burns. Since joining OANDA in 2006, Dean has played an instrumental role in driving awareness of the forex market as an emerging asset class for retail investors, as well as providing expert counsel to a number of internal teams on how to best serve clients and industry stakeholders.
Dean Popplewell