MNI: Canada Flash Retail Sales Rise 0.8% In Dec, Nov Fell 0.2%

Canadian retail sales increased 0.8% in December according to a Statistics Canada advance estimate Friday while the November figure lagged economists predictions for no change with a 0.2% decrease, continuing a pattern of inconsistent demand ahead of next Wednesday's central bank rate decision. 

While the December figure did not come with a breakdown of what sub-sectors led the increase, the drop in November was driven by food and beverage retailers who saw receipts decline by 1.4%. Motor vehicle and parts dealers were up for a third consecutive month, rising 0.5%. 

Sales excluding autos and parts fell 0.5% compared to the consensus for a 0.1% decline, and after excluding gasoline as well they fell by 0.6%, Statistics Canada said.

After removing price changes the volume of sales decreased by 0.2%. That measure is a closer indication of the contribution to gross domestic product.

Statistics Canada revised the October retail headline figure down by 0.2 percentage points to 0.5%.

The report continues to suggest some life in domestic demand even after the Bank of Canada's 10 interest-rate hikes. Officials are also confronting sticky core inflation even as they say there is more evidence they've done enough to re-balance what had been an overheated economy. Other recent data suggest less spending potential with unemployment rising about a percentage point from a record low in recent months and a record jump in mortgage rates pressuring consumer finances. 

Other reports from StatsCan Friday suggest the economy is losing some momentum, with a 1.7% rise in people drawing jobless benefits in November and mortgage credit slowing to 3.1% in November from a year earlier.