MNI 5 THINGS: Canada Aug Retail Sales Disappoint;Gas Weighs>

By Yali N'Diaye

     OTTAWA (MNI) - The following are the key points from the August 

data on Canadian retail sales released Friday by Statistics Canada: 

     - Retail sales contracted 0.1% on the month, while analysts in a 

MNI survey had expected a 0.4% increase. The disappointment was 

reinforced by a downward revision to July's pace of growth, to 0.2% from 

0.3%. However, the 12-month growth rate edged up to 3.6% from 3.5%. 

     - The decline was not a price story but one of weaker activity, as 

volumes, more relevant to real GDP, were down 0.3% after a 0.2% decline 

in July. Still, real sales were up 0.7% year-over-year, the same pace as 

in July. 

     - Decreases were widespread, with sales down in 7 of 11 subsectors 

representing 52% of retail trade. These included a 2.0% drop in gasoline 

stations receipts due to lower activity, as volumes fell 1.9%. Excluding 

gasoline, sales actually rose 0.1% in August, erasing July's 0.1% 

decrease. 

     - A 0.8% gain in sales of motor vehicles and parts was not enough 

to offset the drop in gasoline sales. The autos and parts increase 

benefitted from higher prices as volumes were up just 0.3% on the month. 

Sales excluding this subsector fell 0.4%. Excluding both autos and 

gasoline, retail sales edged down 0.1%. Health and personal stores 

(+1.6%), sporting goods, hobby, book and music (+1.7%), and general 

merchandise (+0.5%), were the other sectors to record higher sales in 

August. 

     - Regionally, declines were concentrated in four provinces, led by 

Quebec, where autos and gasoline station receipts decreased. Cannabis 

sales became legal on October 17 in Canada, and should be integrated 

into Statistics Canada's reports starting with the October reference 

month. 

--MNI Ottawa Bureau; email: yali.ndiaye@marketnews.com 

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