(Ottawa) Statistics Canada said Tuesday that Canadian retail sales rose 1.6% to $57.6 billion in October, as new car sales rebounded after two straight months of declines.
According to the federal agency, the impact of a shortage of semiconductor chips on automobile supply was less pronounced in October than in previous months.
Statistics Canada said sales at auto and parts dealers rose 2.2%, driven by a 2.8% jump in new car sales.
The agency added that its preliminary estimate for November indicated retail sales increased 1.2% from that month, but warned that the number would be revised.
“Canadian trade was strengthening in October and November, before Omicron likely applied the brakes in December,” Andrew Grantham, an economist at CIBC Capital Markets, said in a note to clients.
He noted that the 1.6% increase in retail sales in October was higher than the 1.0% that economists had expected, adding that Statistics Canada’s early November estimates indicated that sales in retail and wholesale trade posted another impressive gain last month.
“Were it not for the rise of Omicron and the tightening of some restrictions across the country, we’d probably have to improve our Q4 GDP forecast,” Grantham said. “As it stands, close to 4.5% may be appropriate considering the modest decline in December.”
Meanwhile, core retail sales, which exclude sales at gas stations and auto and parts dealers, rose 1.5%, the federal agency said.
Sales increased in seven out of eleven sub-sectors in October, accounting for nearly 60% of retail.
Among the biggest increases were hobby, music and book stores, which saw a 17.5% jump in sales.
Statistics Canada noted that the increase coincided with the continued resumption of many recreational and school sports leagues in the fall.
General-store sales of merchandise rose 2.8%, its fifth consecutive monthly gain.
Dealers of building materials and garden equipment posted a 3.2% increase in sales.
Meanwhile, sales in food stores fell 0.6%, mainly due to weak sales at supermarkets and other grocery stores.
Retail sales rose in all provinces except Quebec, where they fell 0.2%. The largest increases were observed in Ontario and Alberta.
In terms of volume, retail sales rose 0.9% in October.
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