Canada August retail sales +0.4% vs +0.5% expected

• Prelim was +0.5%
• Sept preliminary +0.4%
• Ex-autos -0.7% vs +0.3% expected
• Prior ex-autos +0.4%
• Ex-autos and gas -0.4% vs +0.6% prior
• Sales were up in four of nine subsectors

Prior to this report, RBC looked at its cardholder data and said spending was “nothing short of abysmal”. Given that, the growth in this series is surprising but it’s concentrated in autos, which might be reflecting some pent-up demand that’s due to rate cuts. Higher sales at new car dealers (+4.3%) led the increase, followed by used car dealers (+2.1%). The number excluding autos is much softer than anticipated and the lowest since May.

Two categories with large discretionary components are food retailers and furniture, which were soft but clothing was certainly a tailwind. Some of this represents population growth, which has been a major driving of Canadian growth.

This article was written by Adam Button at www.forexlive.com.