By Robb M. Stewart
OTTAWA–Canadian retail sales again rose modestly in July as spending remained subdued after the central bank resumed its campaign of raising interest rates, and an advance estimate suggests sales dipped in August.
Sales rose 0.3% from the previous month to a seasonally adjusted 66.15 billion Canadian dollars, the equivalent of about $49.06 billion, Statistics Canada said Friday. That was slightly weaker than the data agency’s preliminary estimate last month for an increase of 0.4%, and comes after trade edged up by 0.1% for a second month running in June.
July’s advance was moderated by the first drop in sales at car dealers in four months, and by a port workers strike on Canada’s west coast that affected motor vehicle and parts dealers in particular.
In volume terms, sales for July slipped 0.2% from the month before, with sales at gasoline stations and fuel vendors down 1.0% on that basis.
Canada’s central bank raised its benchmark policy rate a further quarter-point in July, taking it to a 22-year high of 5% after a similar increase the month before. The rate was held steady earlier this month amid signs the economy is faltering and consumption growth has cooled.
The rise in retail sales adds to a slightly more positive picture for the economy in July, after it contracted 0.2% at an industry level in June. Wholesale trade rose slightly in July, while manufacturing sales advanced that month.
Compared with a year earlier, retail sales in July were 2.0% higher.
Statistics Canada said that early indications from companies suggest that retail sales decreased 0.3% on-month in August, though the estimate is based on just under half of companies surveyed and will be revised.
The retail data for July showed Canadians spent more on food and drink, with sales up at supermarkets and grocery stores and at beer, wine and liquor retailers.
Overall, sales were higher in seven of the nine retail sectors tracked by Statistics Canada, with spending at new and used car dealers and at gasoline stations falling.
Stripping out gas stations and motor-vehicle and parts dealers, Canadian core retail sales rose 1.3% from June, a rebound after declines the previous two months, the agency said.
Write to Robb M. Stewart at [email protected]
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