October 26, 2015 2:32 pm

Canadian shoppers seen dialing back this Christmas

Credit/THE CANADIAN PRESS
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“It may not be such a merry Christmas for retailers,” Ed Strapagiel, an expert on consumer shopping trends, said Monday in an annual forecast.

Retail sales trends heading into the all-important holiday season suggest many Canadian consumers are poised to dial back this year compared to last, according to Strapagiel, as many confront weak wage gains and mounting debt burdens.

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“It now appears that retail sales growth is past its peak and is moderating just in time for Christmas,” the Toronto-based analyst says in a new forecast. “And the Canadian economy is not poised to help.”

While auto sales have continued to boom this year alongside some other big-ticket items, sales growth in other areas, like electronics, general merchandise stores and supermarkets has turned markedly sluggish, Strapagiel and other experts say.

The 12-month sales trend has flattened out in recent months, while the three-month average has turned lower, “indicating further softening ahead,” Strapagiel said.

MORE: Canadians are on a big-ticket shopping spree 

Only higher auto and furniture sales – aided by a still-hot housing market and ultra-low borrowing rates – have pulled monthly retail sales higher in recent months.

Experts suggest an economy that has yet to brush off a chill created by falling commodity prices (namely oil) won’t get much of a shot in the arm from consumers this holiday season.

“Christmas sales have already started and things are shaping up to be a drawn out, profit-shaking competitive battle,” Strapagiel said. “Retailers who ordered their holiday stock on the basis of strong numbers [to start the year] might get a rude awakening.”

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WATCH: Financial expert Preet Banerjee discusses why now is the time to plan for Christmas shopping.

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