Canada retail sales rose 0.6% m/m in June to CAD 74.3bn, beating expectations for 0.4% and following a revised 1.1% gain in May. Sales increased in seven of nine subsectors. More importantly, core retail sales excluding gasoline and motor vehicles rose 1.2%, extending their advance for a second month. In volume terms, total retail sales increased 1.5%, showing that June’s improvement reflected a meaningful rise in real spending.
General merchandise retailers led core growth with a 2.7% increase. Clothing, footwear, jewelry and related retailers gained 3.1%. Motor vehicle and parts dealers rose 1.0% for a third consecutive month, driven by new-car sales. Food and beverage retailers slipped 0.4%. Gasoline-station receipts fell 4.1%, but volumes increased 4.2%, highlighting the impact of lower fuel prices on nominal sales.
The broader picture is less straightforward heading into Q3. Retail sales rose 2.2% in Q2, though volumes increased a more modest 0.4%. Statistics Canada’s advance estimate points to a -0.8% decline in July, suggesting June’s strength may not have carried forward. The early estimate is based on responses from only 56.5% of surveyed companies and is subject to revision, but it nevertheless tempers the strong June report and points to a potentially softer start to Q3.
Data Summary
| Indicator | Actual | Expected | Previous |
|---|---|---|---|
| Retail Sales m/m | 0.6% | 0.4% | 1.1% |
| Retail Sales ex Autos m/m | 0.5% | 0.2% | 1.2% |
| Core Retail Sales m/m* | 1.2% | — | — |
| Retail Sales Volume m/m | 1.5% | — | — |
| Retail Sales q/q | 2.2% | — | — |
| Retail Sales Volume q/q | 0.4% | — | — |
| July Advance Retail Sales Estimate m/m | -0.8% | — | 0.6% |
*Core retail sales exclude gasoline stations and fuel vendors, and motor vehicle and parts dealers.
Key Takeaways
- Canada retail sales rose 0.6% m/m in June, beating expectations for 0.4%, after May was revised higher to 1.1%.
- Retail sales excluding autos increased 0.5%, also beating the 0.2% forecast.
- Core retail sales rose a stronger 1.2%, extending gains for a second consecutive month.
- Real spending was particularly firm, with retail sales volumes jumping 1.5% m/m.
- General merchandise sales rose 2.7%, while clothing and related categories gained 3.1%.
- Motor vehicle and parts sales increased 1.0% for a third straight month.
- Gasoline-station receipts fell 4.1%, but volumes rose 4.2%, showing lower prices rather than weaker fuel demand drove the nominal decline.
- Retail sales increased 2.2% in Q2, but volumes rose a more moderate 0.4%.
- Statistics Canada’s advance estimate points to a 0.8% decline in July, warning that June strength may not have carried into Q3.
- July estimate is highly provisional, based on responses from 56.5% of surveyed companies, versus an average final response rate of 87.3%.
