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Canada retail sales rise more than anticipated in July; likely up in August

Canadian retail sales grew by 0.9% in July from June, led by greater sales at motor vehicle and parts dealerships, while sales most likely climbed up even more in August, data from Stats Canada revealed on Friday.

The boost in retail sales, to C$ 66.4 billion ($ 49.0. billion), eclipsed price quotes for a gain of 0.6% and could relieve. fears about the strength of the domestic economy.

Sales were up in seven of nine subsectors, representing. 84.6% of retail trade, with sales at automobile and parts. dealers climbing 2.2%. In volume terms, retail sales increased. 1.0%.

The rebound in retail sales volumes in July will be welcome. news to the Bank of Canada, which has actually been worried about the. downside threats to the economy, Olivia Cross, North America. economist at Capital Economics, said in a note.

The Bank of Canada has actually cut interest rates 3 times. given that June, moving in quarter-percentage-point actions, but has. stated it could shift to bigger cuts if the economy requires an increase.

Opportunities of a half-percentage-point relocation in October dipped to. 56% from 59% before the retail sales report, swaps market information. revealed.

Core retail sales, which exclude gasoline stations and fuel. suppliers and automobile and parts dealerships, were up 0.6%,. notching their second successive regular monthly boost.

The gain for core sales was led by food and drink. retailers and basic merchandise merchants.

An initial price quote revealed sales increasing 0.5% in August.

Still, per-capita sales 'still look weak' and deterioration. in the labour market indicate weaker discretionary consumption. ahead, Katherine Judge, a senior financial expert at CIBC Capital. Markets, stated in a note.

Canada has actually seen historically high population development in. current years.

The Canadian dollar was bit changed at 1.3560 per. U.S. dollar, or 73.75 U.S. cents.

(source: Reuters)