Sales at new car dealers gained 0.7 per cent, while used car dealers added 4.0 per cent.Justin Tang/The Canadian Press
Retail sales rose 0.7 per cent to $72.1-billion in February as sales at new and used car dealers climbed, Statistics Canada said Friday.
Toronto-Dominion Bank economist Maria Solovieva said consumers delivered another solid month in February, with early indications pointing to continued strength in March.
Looking ahead, Statscan said its advance estimate of overall retail sales for March pointed to a gain of 0.6 per cent, though it cautioned the figure would be revised.
“That said, inflation jumped in March, suggesting some of the momentum is being driven by higher prices rather than broad-based demand growth,” Solovieva wrote in a report.
“Higher energy prices will dent purchasing power, but we do not expect this to materially weaken domestic demand beyond what’s already embedded in our outlook. Together with the drags from weak population growth and trade-related headwinds, the economy is expected to grow at a below-trend pace this year.”
U.S. consumer sentiment drops to record low in April as Iran war fans inflation fears
Statistics Canada said retail sales in February rose in seven of the nine subsectors it tracks, boosted by motor vehicle and parts dealers which rose one per cent.
Sales at new car dealers gained 0.7 per cent, while used car dealers added 4 per cent.
Core retail sales, which exclude gasoline stations and fuel vendors and motor vehicle and parts dealers, rose 0.6 per cent in February.
The agency said the gain in core retail sales was led by general merchandise retailers, which added 1.2 per cent, and food and beverage retailers, which rose 0.9 per cent.
It also said clothing, clothing accessories, shoes, jewellery, luggage and leather goods retailers gained 1.1 per cent in February.
Sales at building material and garden equipment and supplies dealers fell 0.6 per cent.
In volume terms, overall retail sales increased 0.3 per cent in February.
The Bank of Canada’s next interest rate decision is set for April 29.