Retail sales in January registered their largest gain in almost seven years, the latest sign that the economy is building momentum.
Statistics Canada said Tuesday that retail sales climbed 2.2% to $46.0 billion, the largest monthly percentage increase since March 2010. Economists had expected a gain of 1.1%, according to Thomson Reuters.
“The solid Canadian data just continue to add up,” Benjamin Reitzes, senior economist at BMO Capital Markets, said in a note to clients.
“After a strong end to 2016, it appears as though the economy is off to a good start in 2017.”
The data follows recent stronger-than-expected results for wholesale and manufacturing sales, trade and job creation.
Reitzes said the improvements have prompted BMO to increase its expectations for economic growth for the first quarter to an annual pace of 2.7% compared with its previous forecast of 2.3%.
Retail sales in January were up in 10 of 11 subsectors, led by motor vehicle and parts dealers, which gained 3.8%. Excluding sales at motor vehicle and parts dealers, overall retail sales gained 1.7% in January.
Health and personal care stores gained 6.0% in January after losing 3.0% in December.
In volume terms, retail sales increased 1.3%.