MNI DATA IMPACT: Canada May Flash Retails +19%, April -26%

By Greg Quinn

     OTTAWA (MNI) - Canadian retail sales rose 19% in May according to a flash

estimate, a partial rebound from a record 26% fall in April, reflecting Covid-19

shutdowns followed by the slow re-opening of some stores, data published by

Stats Canada Friday showed.

     The April decline reported Friday was bigger than both the 15% expected by

analysts and the agency's 16% flash estimate given a month ago. 

     Other reports on wholesaling, manufacturing and inflation have also shown

greater-than-expected weakness, suggesting downside risk to a consensus for GDP

to fall as much as 40% annualized in the second quarter. 

     Retail sales have fallen 34% since mid-March when social distancing rules

were first imposed. 

     Motor vehicle and parts sales fell 44% in April to lead the decline by

industry in dollar terms. Food store sales returned to around levels seen before

Covid-19, falling 13% in April. 

     Sales fell in all 11 subsectors, expanding the weakness from March when

initial figures showed just six categories falling. Gasoline station sales fell

a record 32%.

     Excluding autos and gasoline, retail sales fell 21% in April. 

     BOC Deputy Governor Larry Schembri said Thursday the economy faces a

prolonged recuperation and consumers may hold back on spending until a vaccine

is available. Officials are watching for a rise in insolvencies when the more

than 1 million households who tapped into loan deferments go back on the clock. 

--MNI Ottawa Bureau; +1 613-314-9647; email: greg.quinn@marketnews.com

--MNI London Bureau; tel: +44 203-586-2225; email: les.commons@marketnews.com

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