06:41 AM EDT, 06/24/2025 (MT Newswires) -- Canadian consumers were holding up well through April despite the negative hit to sentiment from the trade war with the United States, said Bank of Montreal (BMO).

While Statistics Canada noted that all nine major subsectors saw a negative impact on sales, retail volumes still managed to grind out a solid 0.5% gain in the month.

That leaves volumes up a "sturdy" 3.3% year over year and 4.0% annualized over the latest three months -- autos have been a strong help over both periods, noted the bank.

Coming into the year, retail headwinds were encouragingly

fading. For example, the Bank of Canada was well into its

easing cycle; inflation was ebbing; and real wage growth

was accelerating.

Now, confidence has been hit by the trade war; the job

market has cooled, which should temper the pace of real

wage gains; and mortgage rates continue to reset higher --

even if less than previously.

The early read for May retail spending was negative, and

BMO suspects the consumer will remain cautious through

much of the rest of the year.

A quick and credible trade deal with the U.S. would lift confidence off the floor, but those bigger macro factors will still weigh in the quarters ahead, added the bank.