Key facts
- Canada's retail sales increased by 0.6% in June, exceeding the expected 0.4% rise.
- Total retail sales reached C$74.28 billion in June.
- Sales volume grew by 1.5% in June.
- Significant increases were noted in clothing (3.1%) and general merchandise (2.7%) sectors.
- An advance estimate forecasts a 0.8% decrease in retail sales for July.
Canada's retail sales saw a 0.6% increase in June, surpassing the average analyst expectation of 0.4%, according to data from Statistics Canada. This rise was driven by strong performance in clothing, clothing accessories, shoes, jewelry, luggage, and leather goods retailers, which collectively saw a 3.1% jump. General merchandise stores also experienced a significant surge of 2.7%. Sales at motor vehicle and parts dealers, the largest subsector, rose by 1%, marking their third consecutive monthly increase.
Despite the positive June figures, an advance estimate from Statistics Canada suggests that retail sales are likely to decrease by 0.8% in July. This projected decline is partly attributed to lower gasoline prices, which led to a 4.1% drop in sales at gasoline stations and fuel vendors. Sales at food and beverage retailers, the second-largest category, also fell by 0.4%.
Overall, retail sales, a key indicator for gross domestic product growth, climbed to C$74.28 billion in June from C$73.84 billion in May. In volume terms, retail sales increased by 1.5% in June. Andrew Grantham, senior economist at CIBC Capital Markets, noted that despite monthly volatility, consumer spending shows gradual improvement, expected to continue into the next year, supported by household benefits and a strengthening labor market.