Canadian retail sales declined 0.4% to $70.0 billion in December, marking the first monthly contraction since September as consumers reduced spending on big-ticket items during the holiday season. The downturn was led by a 1.6% drop at motor vehicle and parts dealers, with new car showrooms experiencing their second consecutive monthly decline.

Core retail sales, which exclude volatile automotive and fuel sectors, fell 0.3% following November's robust gains. The weakness was concentrated in building materials and home furnishings, where receipts tumbled 4.0% and 1.7% respectively. Despite the December cooling, annual data reveals a resilient consumer, with total sales rising 4.0% to $837.2 billion for the year. The automotive sector led growth, increasing 4.7% even with the late-year stumble.

Regional performance varied significantly, with Alberta experiencing the steepest provincial decline of 2.1% due to sluggish vehicle demand, while Quebec bucked the national trend with a 0.6% increase. Digital commerce continued its upward trajectory, with e-commerce sales jumping 3.6% to reach $4.3 billion in December, now representing 6.1% of total retail trade. Early data suggests the December slump was a temporary pause rather than a prolonged downturn, with Statistics Canada estimating a 1.5% increase in January retail sales.