BC Economic Snapshot May 26, 2012

VANCOUVER, BC, May 26, 2012/ Troy Media/ – Following two months of gains, retail sales activity in B.C. eased in March, dipping 0.2 per cent from February to a seasonally-adjusted $5.14 billion.

In contrast to the previous month, when B.C. gains outpaced a national decline in sales, the opposite was true in March, as Canadian retail activity rose 0.4 per cent.

Despite the monthly decline, the trend remained modestly positive and retail sales in the first quarter were still up 6.7 per cent from the same period in 2011. Year-to-date sales gains were led by a 7.5 per cent increase in Metro Vancouver, which outpaced a 6 per cent rise in the rest of the province.

At the sector level, the most substantial year-to-date gains were recorded by clothing retailers (22 per cent) and motor vehicle and parts dealers (15 per cent), while growth in housing-related retail activity was more tempered with electronic and appliance sales down 0.5 per cent and home furnishings up a modest 3 per cent – a reflection of weak housing market conditions. Gasoline sales were also up only modestly from the first quarter of 2011.

Year-over-year growth in retail sales is expected to decline over the course of 2012, but remain moderate at 3.4 per cent, compared to 3 per cent in 2011. We expect retail sales growth through 2013 to be modest relative to the past decade, as factors that generally drive consumer spending such as employment, income and population growth will remain tempered.