A pump-driven surge at gas stations and a run of strong auto sales pushed Canadian retail trade up 0.5% to $73 billion in April, but the headline figure obscures a deteriorating picture beneath the surface, with core spending falling for the second month running.
Strip out gas stations and auto dealers and the numbers look considerably worse. Core retail sales dropped 0.7% in April, pulled down by a 2.0% decline at food and beverage retailers, a 1.7% loss at general merchandise stores, and a 1.5% slide in sporting goods, hobbies, and books, a category that has now fallen two months in a row.
The headline gain rested almost entirely on two pillars. Gasoline stations and fuel vendors surged 5.1%, though volume growth came in at just 0.8%, meaning the dollar increase reflected costlier fuel rather than more of it being bought. Motor vehicle and parts dealers added 1.7%, with new car dealerships contributing a 1.8% gain, their fourth straight monthly increase, and used car dealers posting a 5.1% jump after sliding 4.2% in March.
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Measured in volume terms, total retail sales were flat in April.
Six of 13 provinces and territories recorded gains. Ontario climbed 0.5%, carried by auto dealers, while Alberta rose 1.3% on the back of higher fuel sales and British Columbia advanced 1.0%. Manitoba posted the steepest provincial decline at 1.8%, weighed down by weaker motor vehicle sales. Saskatchewan fell 1.1%.
Online retail trade told a similarly soft story. E-commerce revenue slipped 1.2% in April to $5.1 billion, trimming its share of total retail activity to 7.0% from 7.1% in March.
Statistics Canada’s advance estimate points to a 1.0% gain in May retail sales, though the agency cautioned the figure will be revised as more survey responses arrive. A U.S.-Iran agreement struck this week reopened the Strait of Hormuz and eased oil prices, a development that could help lift household budgets and support a broader spending recovery through the second half of the year.
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