ActionForex reports that analysts at TD Bank Financial Group discuss the August retail sales data from Canada.
"Retail sales rose by 2.1% month-on-month in August, rebounding after a soft reading in July. Excluding the price effect, sales were up 1.4% in volume terms. Looking ahead, the agency’s flash estimate calls for some moderation in September, with sales projected to decline by 1.9%."
"Sales of motor vehicle & parts were flat on the month, held back by the ongoing semiconductor shortage. Higher prices at the pump in August, drove gasoline sales higher in nominal terms (+3.8%), but stronger demand also led to gains in volume terms (+1.8%)."
"Core sales, which exclude the two above-mentioned categories, rose by 2.7% in August. Advances in sales at food & beverage stores (+4.8%) – which account for roughly 20% of all retail sales – and at health and personal care stores (+2.3%) boosted the core category."
"Retail sales rebounded nicely in August, with broad-based gains across most categories. Monthly gains were also recorded in every province in Canada – the first time this happened since June 2020. The categories that did underperform were the ones most likely impacted by global supply-chain challenges: autos, furniture, and appliances."
"Households finances remain in fairly good shape, but inflation has been running hot this year chipping away at consumers’ purchasing power. While energy prices were the main culprit earlier in the recovery, price pressures have been broadening recently to categories such as food, shelter, and cars."
"Higher prices, shipping delays and limited availability of some items may reduce how much consumers spend on goods, particularly as they direct a larger share of their budgets toward services. The projected decline in retail sales in September likely a nod in that direction."