Overview
Canadian retail sales eased 0.4% in December to $70.0 billion, reflecting weaker demand for higher-priced items during the holiday month. The largest contributor to the headline fall was a 1.6% decline at motor vehicle and parts dealers, which represented a second straight monthly contraction for new car showrooms.
Core retail trends
When excluding the more volatile automotive and fuel components, core retail sales slipped 0.3% following a strong November gain. This softening was concentrated in categories tied to homes and renovations: building materials receipts fell 4.0% while home furnishings dropped 1.7% in December.
Annual picture
Despite the December slowdown, aggregate retail activity for 2025 showed a resilient consumer backdrop with total annual sales up 4.0% to $837.2 billion. Automotive sales led year-on-year growth in the retail economy, rising 4.7% even though the sector weakened at the end of the year.
Regional variation
Provincial performance diverged in December. Alberta experienced the steepest monthly decline at 2.1%, a decline linked in the data to sluggish vehicle demand. In contrast, Quebec posted a 0.6% increase, standing out as a positive exception in an otherwise muted month.
Digital commerce
E-commerce continued to expand as a share of retail activity. Seasonally adjusted online sales rose 3.6% in December to $4.3 billion. Online transactions now account for 6.1% of total retail trade, up from 5.8% in the prior month.
Near-term outlook
Early indications suggest the December decline may have been a temporary pause. Statistics Canada provided an advance estimate indicating retail sales are on pace to increase 1.5% in January.
Data points in this article are derived from Statistics Canada releases on retail sales for December and the 2025 annual totals, including the advance estimate for January.