. however, even before the pandemic hit our shores earlier this year, there was increasing evidence that consumption growth was slowing as households were becoming more cautious, perhaps because of elevated debt levels and a somewhat less robust economy. when the containment measures were imposed in canada in mid - march, many households had to suddenly prepare for a prolonged stay inside their homes to reduce their exposure to covid - 19. as a result, spending habits changed significantly. in particular, household consumption was affected by the reduction of goods and services available for purchase. many non - essential stores and restaurants were forced to close, while others had only online access or takeout service. 8 these demand and supply effects not only lowered consumption during the containment period but also changed what canadians were buying. the volume of consumption, as measured by the national accounts, plummeted by nearly 9. 0 percent in the first quarter of 2020 at an annual rate, and the 7 on the demand side, sharp declines in stock markets had negative wealth effects, and lower commodity prices reduced canada ’ s terms of trade. both factors also weighed on consumption. 8 according to a survey by statistics canada, 40 percent of retailers closed their doors in march, including 91 percent of clothing retailers. most remained closed until recently. in contrast, grocery and pharmacy stores remained open. - 6preliminary release for april indicates a further decline as nominal retail sales fell 15. 6 percent ( chart 4 ). 9 chart 4 : retail trade activity declined sharply across canada nominal retail trade deflated by provincial cpi for goods, index : april 2018 = 100 index apr - 2018 aug - 2018 canada dec - 2018 apr - 2019 energy - intensive regions aug - 2019 dec - 2019 rest of canada note : the april 2020 value for canada is a preliminary estimate. source : statistics canada apr - 2020 last observation : april 2020 consumption patterns during the early stages of the shutdown saw a boom in demand for necessities. many households stocked up on food, alcohol and personal care products — creating the infamous runs on toilet paper, flour and cleaning products. in the first week of march, sales of hand sanitizer rose 792 percent over the same week last year ( chart 5 ). chart 5 : sales of health and household cleaning items spiked in march 52 - week percent change january hand sanitizers february masks and gloves note : data are experimental and subject to revision. source : statistics canada consumer prices program, special tabulation march soap april bathroom tissue % -

##t - up demand. the household savings rate rose from 3. 6 percent in the fourth quarter of 2019 to 6. 1 percent in the first quarter of this year. in addition, april saw an unprecedented increase in deposits in personal bank accounts, consistent with higher savings continuing into the second quarter ( chart 18 ). some of the higher savings may be the result of the decline in discretionary spending by some households on services, motor vehicles and clothing. without restaurants or 23 with most of the fiscal support flowing through transfers ( cerb ) rather than through wage subsidies ( cews ), some people may temporarily lose the incentive to return to work. - 19 movie theatres to go to, money simply accumulated in household bank accounts. some of this accumulation may, however, represent a deliberate choice by many canadians to save more as a precaution, given the higher uncertainty about the future. these precautionary savings could be converted into more consumption if confidence improves as the economy is reopened and the virus is controlled. of course, there are sizable differences in financial circumstances across households. we are mindful that many lower - income families who have lost their jobs are having difficulty making ends meet. they may be dipping into their savings or taking on more debt to simply buy necessities. 24 chart 18 : deposits in personal bank accounts rose sharply in april monthly growth in chequeable and non - chequeable deposits % source : regulatory filings of canadian banks - 1 last observation : april 2020 the recovery of services subject to a more gradual removal of containment measures, such as travel services, is expected to be more protracted. the rebound in services that are usually consumed in crowded environments, such as restaurant meals as well as cultural and sporting events, should also be limited by capacity constraints. we expect that the recovery will vary by region because containment measures are being lifted at different times across canada ( chart 19 ). this staggered reopening of establishments and manufacturing facilities across the country adds an additional layer of uncertainty in estimating the path of the recovery in overall household spending. for example, ontario made more frequent announcements but pursued a more gradual reopening than saskatchewan and alberta, where a greater share of businesses opened sooner. 24 j. c. macgee, t. m. pugh and k. g. see, “ the heterogeneous effects of covid - 19 on household consumption, debt and savings ” bank of canada staff analytical note ( forthcoming ), examine the impact of