There have been pockets of good news amid all the business misery associated with COVID-19.
After a dismal early and mid-2020, sales started growing again until winter hit and COVID-19 went up and more shoppers stayed home.
Many stores in Burnaby malls closed down forever, such as Microsoft, Aldo, Pink and Frank and Oak, but those empty storefronts are starting to fill up a bit, including the arrival of Hugo Boss at Metropolis at Metrotown in Burnaby. The Amazing Brentwood has also seen many of its storefronts in its expansion get big arrivals such as Nike and Adidas.
But amidst these pockets of positive news comes the disappointing report that Canadian retail sales fell for a second consecutive month in January.
Statistics Canada said Friday retail sales fell 1.1 per cent to $52.5 billion for the first month of the year. Sales at clothing and clothing accessories stores dropped 17.8 per cent and furniture and home furnishings stores lost 15.1 per cent. Sales at sporting goods, hobby, book and music stores fell 16.8 per cent.
The hope, however, is that preliminary February estimates pointed to a gain of 4.0 per cent for the month – but those gains face an uncertain future if a so-called “third wave” hits the country.
"The recovery in February retail sales adds to the evidence suggesting that GDP growth continued into the second month of the year," CIBC senior economist Royce Mendes wrote in a report suggesting the bank's forecast for the first quarter might have been too conservative.
"That being said, the risks to the economy from the third wave of the virus are now greater than they were at the time those forecasts were made. As a result, the second quarter might begin on weaker footing than previously envisioned."
Statistics Canada reported last week that the economy added 259,000 jobs in February, outpacing the net gain of 75,000 jobs that had been expected and the Bank of Canada said earlier this month that it now expects the economy to grow in the first quarter compared with its earlier expectation that there would be a contraction to start the year.
TD Bank economist Ksenia Bushmeneva said credit and debit card data show spending staged a solid rebound as provinces began to gradually lift restrictions last month.
"All in all, the Canadian economy has shown relative resilience in the face of the second wave of the pandemic, and the recent economic reopening ushers optimism about the days ahead," Bushmeneva wrote.
That being said, the slow pace of vaccination-to-date and the recent uptick in cases continue to pose uncertainty to consumers and businesses alike about what the next few months could hold."
- With additional reporting by the Canadian Press
