Retail sales drop during Christmas shopping season

Statistics Canada says Canada's retailers suffered a weak final month during last year's holiday shopping season, with December retail sales edging down 0.2 per cent to $38.6 billion.

The small drop in overall retail performance followed four monthly increases in retail sales, though the agency said sales volumes were stable.

Holiday shoppers kept a tight hold on their wallets, with stores that usually cater to holiday gift-givers among the worst performers.

Sales at department stores were down 1.5 per cent for a fourth consecutive month and sporting goods, hobby, book and music store saw sales drop for the first time in five months, down 3.4 per cent in December.

"The decrease largely reflected weaker sales at sporting goods stores," Statistics Canada said in its report.

Electronics and appliance store sales were down 2.8 per cent, falling for the second month in a row, while sales at clothing and clothing accessories stores fell 0.8 per cent after rising in October and November.

"Surprisingly, furniture/building material store sales were strong, in contrast to softness in those categories in recent months," noted CIBC World Markets economist Emanuella Enenajor.

"The flat volume print, however, suggests that retail will exert a neutral influence on GDP in December, a bit softer than we had been expecting."

Statistics Canada said sales were down in seven of 11 subsectors, representing 61 per cent of retail sales.

Sales at motor vehicle and parts dealers slipped 0.1 per cent, the first decline in five months. Gasoline stations reported a 1.1 per cent decrease in sales after four consecutive months of increases.

Sales were down in five provinces, with British Columbia reporting the largest drop in dollar terms at 1.4 per cent.

Saskatchewan reported a 3.5 per cent drop in 12 months, while Alberta sales slipped 0.7 per cent after four straight monthly increases.