Retail sales increased 0.8% to $69.8 billion in March. Sales were up in six of nine subsectors and were led by increases at motor vehicle and parts dealers, according to a report released Friday by Statistics Canada.
Core retail sales—which exclude gasoline stations and fuel vendors and motor vehicle and parts dealers—were up 0.2% in March. In volume terms, retail sales increased 0.9% in March, said the federal agency.
Retail sales were up 1.2% in the first quarter of 2025, marking a fourth consecutive quarterly increase. In volume terms, retail sales increased 0.2% in the first quarter, it added.
“The largest increase in retail sales in March was observed at motor vehicle and parts dealers (+4.8%), up for the first time in three months. All four store types within this subsector posted gains, with higher sales at new car dealers (+5.2%) driving the increase,” said Statistics Canada.
“Sales at gasoline stations and fuel vendors (-6.5%) decreased in March after five consecutive monthly increases. In volume terms, sales at gasoline stations and fuel vendors decreased 2.6%. Gasoline prices fell 1.6% on an unadjusted year-over-year basis in March, stemming from lower crude oil prices amid concerns of slowing global oil demand and slowing economic growth related to the threat of tariffs.”
Core retail sales increased 0.2% in March, posting their second consecutive monthly increase. The gain was led by higher sales at building material and garden equipment and supplies dealers (+2.6%), followed by clothing, clothing accessories, shoes, jewelry, luggage and leather goods retailers (+2.6%), added StatsCan.
“Higher sales were also recorded at furniture, home furnishings, electronics and appliances retailers, which posted an increase of 2.1% in March. The largest decrease to core retail sales in March came from general merchandise retailers (-2.7%),” it said.
Statistics Canada said retail sales increased in eight provinces in March. The largest provincial increase in dollar terms was observed in Quebec (+1.6%). In the Montréal census metropolitan area (CMA), sales were up 3.1%. In Ontario, retail sales increased 0.6% in March, led by higher sales at motor vehicle and parts dealers. In the CMA of Toronto, retail sales were down 1.0%. The largest provincial decrease in retail sales in March was observed in Manitoba (-1.6%). This decrease was led by lower sales at gasoline stations and fuel vendors.
“On a seasonally adjusted basis, retail e-commerce decreased 2.1% to $4.2 billion in March, accounting for 6.0% of total retail trade, compared with 6.2% in February,” explained Statistics Canada.
“Statistics Canada is providing an advance estimate of retail sales, which suggests that sales increased 0.5% in April. Owing to its early nature, this figure will be revised. This unofficial estimate was calculated based on responses received from 60.2% of companies surveyed. The average final response rate for the survey over the previous 12 months was 91.0%.”
Andrew Grantham, Senior Economist, CIBC Capital Markets, said Canadian consumers haven’t tightened the purse strings much it seems in the face of tariff uncertainty.
“However, the advance estimate for April suggested that overall sales rose by a further 0.5%, which is a little firmer than we would have expected given the recent weakening in the labour market. Overall, consumer spending growth does appear to have slowed relative to the second half of last year, but not worryingly so as yet,” he said.
Marc Ercolao, Economist, TD Economics, said March retail sales data came in a bit warmer than expected.
“Consumers pulled forward their auto purchases, something we expected as buyers front-ran counter tariffs imposed in April. The surprise was in the 5 of 7 non-auto retail components that advanced on the month, which may represent stockpiling of non-discretionary items ahead of other incoming tariffs,” he said.
“Expectations for another solid month of sales growth in April may offer some positive momentum for total consumer spending into the second quarter, though we expect spending weakness to dominate the broader trend. Canadian consumer confidence has nosedived in recent months and the labour market has started to shed jobs. Against this backdrop, we expect consumers to stay relatively hesitant until confidence and clarity are restored, which we think will occur in the later stages of this year. A few more Bank of Canada rate cuts in the coming months may help soften the blow.”
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