- Steven Poloz, Bank of Canada Governor
Canadian wholesale sales disappointed in February, recording the biggest monthly fall in more than a year amid steep declines in the machinery and auto sectors. Wholesale trade dropped 2.2% from January to a seasonally adjusted C$55.77 billion, Statistics Canada reported. Economists' expectations were for a 0.4% retreat. The fall was the largest since the 3.6% decline recorded in January 2015. Lower sales were registered in five of seven subsectors, accounting for 66% of total wholesale trade. In volume terms, sales dropped 1.9%, while inventories climbed 0.2% to C$73.16 billion.
Wholesale sales data is another sign, along with a decline in February manufacturing shipments, that Canada's gross domestic product is likely to be weak for February. The GDP report is due out next week. Last week, the Bank of Canada maintained its benchmark interest rate unchanged at 0.5%, referring to the positive impact of new fiscal measures from the federal government. However, the central bank warned that the Canadian economy continues to face strong economic headwinds, including sluggish foreign demand and a recent currency rally, which could slow growth in the non-resource sector. Canada's resource-reliant economy has experienced the biggest hit among Group of Seven economies from the commodity-price plunge.
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