• Retail sales up 0.9% in November
  • Excluding price-impacts, sales up 0.7% month-over-month, but unchanged from a year ago
  • E-commerce sales continue to outpace brick-and-mortar sales

The tick up in Canadian retail sales in November breaks a string of generally softer economic data for the month after disappointing manufacturing and wholesale reports earlier this week. It would take more reports like this one to really alter what have been lackluster trends in the retail sector, though. Excluding price impacts, volume sales were still unchanged from a year ago in November (despite a 0.7% month-over-month increase). Overall consumer spending trends have probably still been a bit stronger than that – the retail sales numbers do not include spending on services (which are more than half of consumer spending). And the headline retail sales numbers also exclude a portion of e-commerce sales, which slowed in November but are still running stronger than headline retail sales at +6.6% year-over-year in November. Households are clearly also willing to spend more on real-estate with housing markets in BC and Ontario in particular showing signs of heating up again.

Still, domestic growth concerns are once again front and center at the Bank of Canada, despite what looks like a less-worrying external backdrop with the US and China agreeing to hit pause in their ongoing trade war. Overall economic activity (i.e. GDP) looks like it increased little if at all in Q4. Some of that softness, but not all, is due to transitory factors. The central bank will rightly be more focused on economic data releases until it becomes clear whether recent faltering is a sign of underlying fundamental deterioration, or yet another statistical blip in what is often volatile Canadian economic data.


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