MNI 5 THINGS: Canada December Retail Sales -0.1%; Ex Gas +0.4%>

By Yali N'Diaye

     OTTAWA (MNI) - The following are the key points from the December 

data on Canadian retail sales released Friday by Statistics Canada: 

     - Retail sales contracted a further 0.1% in December, which was 

still better than the 0.5% decrease expected by analysts in a MNI 

survey. Lower oil prices explained a large part of the decrease, while 

higher car sales brought a partial offset. 

     - Overall, the weakness was widespread across sectors, as sales 

declined in 7 of 11 of the major categories, although they represent 

less than half of retail trade (43%). Weaker sales at gasoline stations 

were largely to blame, owing to lower gas prices at the pump. Excluding 

the 3.6% drop in gas stations sales, of which only 0.3% was related to 

lower volumes, retail sales actually increased 0.4%. 

     - The 1.0% gain in autos and parts brought strong support and was 

entirely due to higher volumes. Excluding autos and parts, sales would 

have been down 0.5%, marking the fifth consecutive monthly decrease, 

which has never happened before. Analysts had expected a 0.4% drop. 

Excluding both autos and gas, sales edged up 0.1%, the some as in 

November. 

     - For the fourth quarter as a whole, total sales contracted 0.5%, 

the largest decline since the first quarter 2015, following a 0.7% 

increase in the third quarter. Volumes were flat after rising 0.3% in 

the third quarter. Sales were also flat excluding auto,s and excluding 

autos and gas, after rising 0.3% in the third quarter. Overall, sales 

rose 2.7% in 2018, the lowest growth rate since 2015. Real sales rose 

0.7% in 2018, the lowest increase since 2009. 

     - Friday's data showed consumer spending momentum continued to fade 

at the end of 2018, confirming the Bank of Canada's scenario of 

weakening contribution to GDP from households. The central bank 

continues to count on exports and business investment to become stronger 

engines of growth. 

--MNI Ottawa Bureau; email: yali.ndiaye@marketnews.com 

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