OTTAWA (Reuters) - Canada's retail sales contracted for the second consecutive month in February, missing expectations, data showed on Wednesday, led by a drop in sales at gasoline stations and fuel vendors.
Retail sales decreased 0.1% in February after a 0.3% contraction in January, Statistics Canada said, adding a preliminary estimate showed that sales were likely to remain unchanged in March.
Two back-to-back months of a fall in retail sales reflects the continued strain on the economy from high interest rates.
Analysts polled by Reuters had forecast a 0.1% rise in retail sales in February. In volume terms, however, sales fell 0.3% in February.
Core retail sales, which exclude gasoline stations and fuel vendors and motor vehicle and parts dealers, were unchanged in February.
The Canadian economy has managed to post positive growth in January and is expected to be positive in February too, but the rate of growth has been weak as consumers and businesses buckle under the pressure of rates at a near 23-year high.
The Bank of Canada (BoC) kept its key overnight rate unchanged at 5% earlier this month, the sixth time in a row, but said that a rate cut in June was a possibility.
Retail sales in February totaled C$66.67 billion ($48.65 billion), with a contraction in five of the nine sub-sectors, Statscan said.
($1 = 1.3705 Canadian dollars)
(Reporting by Promit Mukherjee and Dale Smith; editing by Barbara Lewis)
