Canada Retail Sales Strong; Jewelry Demand Positive
\nIDEX Online,\u00c2\u00a0Israel\u00c2\u00a0
\n(June 29, ’06, 10:06 Ken Gassman)
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Canadian retail sales, including fashion accessories such as jewelry, posted a solid gain in April, 2006. Fueled by low unemployment and strong economic growth, Canadian consumers continue their shopping spree, which began late last summer. The graph below illustrates total retail sales gains (ex-auto) as well as mall jewelry sales since mid-2005.<\/p>\n
Sales by Sector: Automobile Sales Led the Way Six out of eight retail sectors experienced sales gains in April, with the automotive sector leading the way. \u00e2\u20ac\u0153Miscellaneous retailers,\u00e2\u20ac\u009d which include retailers such as office supply stores, sporting goods stores, and hobby, music and, book stores, also posted a very strong gain. The other sectors, including jewelry, posted gains, but modestly below the national average.
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\nConsumer spending on clothes and accessories \u00e2\u20ac\u201c including jewelry \u00e2\u20ac\u201c remains robust; this sector has posted solid gains in nine of the past 10 months. The graph below summarizes Canadians\u00e2\u20ac\u2122 spending on jewelry and other fashion items.\u00c2\u00a0<\/p>\n
Consumer spending in building and outdoor home supplies fell in April, ending a five-month streak of sales gains. The first three months of this year were exceptional for this retail sector, and the quarterly gain was the strongest in over two years. Despite being the fastest growing sector in Canadian retailing for the past four years, building and home supply stores have seen their annual rate of growth slow recently. In part, this is due to a series of interest rate increases that the Bank of Canada has recently delivered. Based on April\u00e2\u20ac\u2122s sales, consumers are responding to these higher interest rates with slowing consumption of home-related goods as well as some other durable categories.
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\nOther Factors Affecting Retail Demand
\nGasoline prices rose by 13.5 percent in April, the second largest gain in 23 years. So far, however, consumers seem to be shrugging off those elevated prices.
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\nThe number of people employed increased by an estimated 97,000 in May, driving the unemployment rate down 300 basis points to 6.1 percent, the lowest level since December 1974. All of May\u00e2\u20ac\u2122s employment progression was in full time jobs (+151,000), the largest increase on record.
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\nHousing starts continued their decline; they have been on a downward slope for the past four months. Housing activity is being dampened by higher interest rates.
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\nThe average hourly wage in May was up 3.8 percent from the same period last year. This compares favorably to a 2.4 percent rise in the Consumer Price Index.
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\nSales in the Provinces
\nThe Prairie Provinces have been buoyed by the automotive sector. In Alberta, retail sales jumped by 17.4 percent versus April 2005. Employment growth in Alberta has outpaced the rest of the country over the past 12 months, as consumers have migrated toward the province\u00e2\u20ac\u2122s hot labor market. Alberta\u00e2\u20ac\u2122s net migration was over 16,000 in 2005, more than double British Columbia\u00e2\u20ac\u2122s net migration of almost 7,500 people. All other provinces experienced negative net migration in 2005. Over the past 12 months, the provincial hourly wage growth was 6.8 percent in Alberta, driven by a tight labor market. Given these strong fundamentals, it is no surprise that consumers continued to spend their money on new cars as well as used autos and recreational vehicles.
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\nThe growth of sales in neighboring Saskatchewan has generally followed Alberta\u00e2\u20ac\u2122s lead.
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\nGrowth in the Atlantic Provinces was mainly driven by retail consumption \u00e2\u20ac\u201c especially new cars \u00e2\u20ac\u201c in Newfoundland and Labrador.
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\nRetail sales in Quebec and Ontario also were up moderately.<\/p>\n","protected":false},"excerpt":{"rendered":"
Canada Retail Sales Strong; Jewelry Demand Positive IDEX Online,\u00c2\u00a0Israel\u00c2\u00a0 (June 29, ’06, 10:06 Ken Gassman) \u00c2\u00a0 Canadian retail sales, including fashion accessories such as jewelry, posted a solid gain in April, 2006. Fueled by low unemployment and strong economic growth, Canadian consumers continue their shopping spree, which began late last summer. The graph below illustrates […]<\/p>\n","protected":false},"author":4,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[411],"tags":[],"yoast_head":"\n