Canada's retail sales likely to rise in August, official says

OTTAWA, Sept 23 Reuters - Canadian retail sales most likely rose 2.1% in August after dipping 0.6% in July as restrictions linked to the COVID 19 pandemic were lifted, Statistics Canada said in a flash estimate on Thursday.

The decline in July, the third drop in the past four months, was smaller than the forecast by analysts in a Reuters poll.

With only a modest pullback in retail sales in July, a rebound in August and surging spending on services, the economy will be driven by consumer spending growth in the third quarter, said Royce Mendes, senior economist at CIBC Capital Markets, in a note.

Retail trade in July fell in part due to lower sales at food and beverage stores which coincided with the easing of pandemic restrictions for restaurants and bars.

Statscan told 0.5% of retailers were closed at some point in July, compared to approximately 5.2% in June.

The share of retail sales that were accounted for by electronic commerce declined from 6.2% to 4.6% in June as shoppers returned to retail stores.