Canada Retail Sales Rise 1.2% in August, Reversing July Decline

Canadian retail sales rose 1.2% in August from July to C$74.57 billion ($53.2 billion), slightly below expectations, led by higher sales at motor vehicle and parts dealers, Statistics Canada said on Friday. The gain reversed a 0.7% drop the previous month. Sales increased in all nine subsectors, and volume terms also rose 1.2%. Motor vehicle and parts dealers, which account for more than a quarter of total retail sales, posted a 1.2% increase. Food and beverage retailers, the second-largest category, saw sales rise 1.1%. Core retail sales, excluding gasoline stations and motor vehicle and parts dealers, were up 1.1%. The agency's flash estimate pointed to a 0.7% increase in September. The data arrives ahead of the Bank of Canada's monetary policy decision next week, with money markets pricing a 25-basis-point rate hike while economists remain divided on whether the central bank will hike or hold.