By Promit Mukherjee
OTTAWA, Oct 23 (Reuters) – Canadian retail sales rose 1.2% in August from July to C$74.57 billion ($53.2 billion), slightly less than expected, and were led by higher sales at motor vehicle and parts dealers, Statistics Canada said on Friday.
The higher sales reversed the previous month’s drop of 0.7%.
Retail sales, which include purchases of cars, furniture, food and gasoline, are considered an early indicator of gross domestic product growth and account for about 40% of consumer spending.
• Sales likely increased 0.7% in September, the agency said in a flash estimate.
• In August, sales were up in all nine subsectors. In volume terms, retail sales increased 1.2%.
• This is the last major data before the Bank of Canada’s monetary policy decision next week where money markets are pricing in a rate hike of 25 basis points. However, economists are divided on whether the BoC will hike or hold.
• Core retail sales, which exclude gasoline stations and fuel vendors and motor vehicle and parts dealers, were up 1.1% in August, StatsCan said.
• Sales at motor vehicle and parts dealers, which contribute more than a quarter of total retail sales, increased by 1.2%, thereby contributing the most to the gain in retail sales in August.
• Purchases at food and beverage retailers, the second-biggest category, were up by 1.1% in August after a decline in July, data showed.
(Reporting by Promit Mukherjee and Dale Smith; Editing by Toby Chopra)
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