Retail sales in Canada rose 0.6% in July to retrace an unrevised 0.6% drop in June.
Figures released this morning by Statistics Canada also show that strength was broadly-based following broadly-based weakness the prior month with gains reported in eight of 11 sub-sectors in July.
Sales at gasoline stations rose 3.2%, with Statistics Canada noting that the increase reflected both higher prices and sales volumes. Also contributing to the overall increase were solid gains at clothing (+1.9%) and general merchandise stores (+1.1%) following declines of 2.3% and 0.8%, respectively, in June. Partial offset was provided by a 0.6% drop in sales of motor vehicles and parts, the first decline in the component since December 2012.
Excluding the impact of prices, the nation's number-crunchers volume of sales rose 0.5% to retrace partially a sizable 1.3% drop (previously reported as -1.2%) in June.
Retail sales have been choppy in recent months, in part due to severe flooding in Alberta and a construction strike in Quebec that appeared to disrupt activity in June. Despite the monthly volatility, however, the volume of sales in July reported today was still an annualized 0.7% above its Q2 average.
"Assuming continued growth in August and September," according to experts at RBC Economics, "this remains consistent with our forecast that consumer spending will grow at a respectable rate of close to 2% in Q3, suggesting little payback from the outsized 3.8% gain in Q2 that marked the strongest quarterly pace of real household spending growth since Q4 2010."
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