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Canadian Retail Sales Rebound in March, Consumer Spending to Remain Key Pillar of Economic Growth

Canada’s retail sales rebounded in Marc after declining slightly in February. Retail sales rose 0.7 percent in the month on a sequential basis. In real terms, volumes grew strongly by 1.2 percent in March. The retail sales print came in above consensus expectations of a 0.4 percent rise.

The rise in the headline figure was mainly driven by sales at motor vehicle and parts dealers, electronics and appliance stores and general merchandise stores. Meanwhile, decline in sales at clothing and accessories stores, food and beverage stores and at gasolines stations provided some offset, mainly due to lower prices.

Region wise, the rises were broad based with Quebec, Alberta and Newfoundland and Labrador the only provinces to register lower sales in the month. British Columbia and Ontario recorded the bulk of the gains.

For the first quarter of 2017, the volume of retail sales rose 1.9 percent and will therefore be a main contributor to the overall economic growth in the quarter, noted TD Economics in a research report. March’s solid figure also gives a strong handoff for the second quarter.

Some easing in the housing market might filter through to subdued demand for housing related retail items, but an overall sound domestic economy might support modest growth in retail volumes in the future. Consumer spending is expected to grow at a decent print of about 2 percent in the rest of this year, remaining the important pillar of growth in the Canadian economy, stated TD Economics.The material has been provided by InstaForex Company – www.instaforex.com