Canadian consumers went on a buying spree in January, with retail sales bouncing back 2% to $29.8 bullion after falling 1.2% in December, Statistics Canada said today.

StatsCan said the same trend of strong post-Christmas sales was seen last year, possibly due to increasingly popular gift cards pushing holiday purchases into the new year.

When car and recreational vehicle sales are left out of the equation, retail sales surged 2.4% in January, with shoppers spending more in all sectors.

While new car dealers saw their sales rise for the first time in three months, the 1.3% sales gain was partially offset by a 2.5% decline at used and recreational motor vehicle and parts dealers. According to preliminary results from the auto industry, the number of new motor vehicles sold in February jumped by about 10% compared with January.

In Quebec, retailers experienced a 4.7% growth rate in sales in January, their largest monthly sales figure in almost four years, after posting a 3.4% loss in December.
Consumers were also spending more in retail stores in Manitoba (+2.7%), Ontario (+2.3%) and Alberta (+1.6%) in January, although spending had fallen during the last two months of 2004. Overall, consumer spending in the three provinces has been on the rise throughout 2004.

Other economic indicators suggest the rebound continued in February, with employment rising 0.2% after three months of essentially no change. Housing starts also rose 5.3% in February, partially rebounding from January’s 13.7% drop.