Retail sales across Canada fell by 1.1 per cent to $69.2 billion in May, largely driven by a drop in motor vehicle and parts dealer sales, Statistics Canada reported.
Sales at motor vehicle and parts dealers decreased 3.6 per cent in May, led by a 4.6 per cent decline at new car dealers, while gasoline stations and fuel vendors also posted a 1.4 per cent decrease. Core retail sales, excluding gasoline and vehicle sales, were relatively unchanged, with food and beverage retailers down 1.2 per cent.
Despite the national decline, preliminary figures from Statistics Canada indicate a potential rebound in June with a 1.6 per cent increase.
Andrew Grantham, a senior economist with CIBC Capital Markets, noted the June rebound could signal a return to GDP growth in the second half of the year, although he cautioned the details behind the figures remain unclear.
“While the Bank of Canada is widely expected to keep interest rates on hold next week, further rate reductions may still be needed later in the year to ensure growth is strong enough to close the slack that has built up in the economy,” Grantham said in a note to clients.
Trade tensions continue to weigh on retailers, with 32 per cent of businesses reporting impacts in May, down slightly from April.
Oxford Economics’ Michael Davenport noted that households are tightening spending amid uncertainty and potential impacts from tariffs if trade negotiations are not resolved by the August deadline.
While national retail sales declined in May, Saskatchewan saw growth. According to Statistics Canada, Saskatchewan’s retail trade rose 6.4 per cent in May 2025 compared to May 2024, above the national average of 4.9 per cent, tying the province for second among Canadian provinces.
The total value of retail trade in Saskatchewan reached $2.3 billion in May, with the province’s economy continuing to show strength in broader indicators. Saskatchewan’s real GDP reached $80.5 billion in 2024, a 3.4 per cent increase over the previous year, while private capital investment rose by 17.3 per cent to $14.7 billion last year. Investment is projected to increase further in 2025 to $16.2 billion.
Retail sales track the total receipts at stores selling goods and services directly to consumers and are a key indicator of consumer spending and economic activity across the country.
-with files from The Canadian Press
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