Canadian retail sales rose 0.7% in March compared with an expected increase of 0.4% while there was an increase of 6.9% over the year as the February decline was revised to 0.4% from 0.6%.
On a volume basis, sales increased 1.2% on the month with a 5.3% annual advance.
Underlying sales declined 0.2% on the month with a 5.7% annual increase.
Sales increased in six of the 11 sub-sectors on the month.
There was a robust 3.2% increase in motor vehicle sales to give a 10.2% annual increase.
There was also a strong 3.1% increase in electronics sales to give a 11.2% annual gain.
The advance in sales related to housing purchases and renovation illustrates a positive impetus from housing-market strength.
Clothing sales, however, declined sharply by 2.7% on the month and there was also a decline in food and drink sales, although these categories still recorded an annual increase.
Overall retail sales are exhibiting solid growth and the decline in prices on the month is likely to have been magnified by lower gasoline prices. There should be a recovery in prices for April, but a further decline could have some implications for monetary policy.
The data overall does not suggest that monetary policy needs to be loosened, although the overall policy impact should be limited.