Canadian retail sales surged to a record high for the second straight month in April, in part due to a near-record price hike for gasoline.

Statistics Canada reported today that retailers sold $32.8 billion worth of goods and services, up 1.7% from March, identical to the increase the month before.

These back-to-back gains were the strongest monthly advances since a 1.8% increase recorded in March 2004.

The data was much stronger than the 0.4% increase that had been expected and increased investor expectations that the Bank of Canada will hike interest rates in July.

Excluding auto sales, retail sales rose 1.9% from March.

Six out of eight retail sectors experienced sales gains in April with the automotive sector leading the way, rising 3.6%.


April’s robust sales conditions followed the strongest quarterly gain in four year. Excluding sales by dealers of new, used and recreational vehicles and auto parts, retail sales rose 1.9% from March, continuing a string of sales increases that started in December 2005.

Once prices are taken into account, total retail sales in constant dollars grew by a smaller but nevertheless robust 1.2% in April. While the effect of higher gasoline prices was significant (they rose 13.5% in April, the second highest increase in 23 years), these were partially offset by lower prices at other stores, such as clothing and accessories stores, general merchandise stores, and miscellaneous retailers.