CLARIFY: Canada July Wholesale +1.7% Vs 0.0% Forecast

Adds that 20% gain in pharmaceuticals was for imports in third paragraph. 

By Greg Quinn

     OTTAWA (MNI) - Canadian wholesale sales rose the most in more than two

years in July on motor vehicles and record medicine imports, strength that made

a tiny dent in the most bloated inventories in over two decades.

     Sales rose 1.7% from June to a record C$65.4 billion, well ahead of the MNI

economist median calling for no change.

     Motor vehicle and parts sales rose 4% to C$11.4 billion in July, the

strongest showing for this category in July in a decade, Statistics Canada said

Monday from Ottawa. Personal and household goods gained 4.7%, led by a 20% jump

in pharmaceutical imports.

     The report meshses with the Bank of Canada's view the domestic economy is

resilient and near full capacity, even as some investors are betting a global

trade war will lead policy makers to cut interest rates later this year. Sales

have climbed in six of the first seven months of this year and are up 3.4% from

July 2018.

     One trouble spot in today's report is a buildup on inventories, a potential

sign companies are struggling to sell their goods. Even with the strong sales

gain, the ratio of inventories declined only a notch to 1.44 in July from 1.45

in June. The June figure is the highest since October 1995. Total inventories

climbed 0.5% in July, the 11th consecutive increase.

     Excluding price changes, sales volumes rose 1.9% in July. The volume

figures have a bigger influence on the July GDP figures that will be released on

Oct. 1.

--MNI Ottawa Bureau; +1 613-314-9647; email: greg.quinn@marketnews.com

--MNI Ottawa Bureau; +1 613 981-1671; email: anahita.alinejad.ext@marketnews.com

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