(Bloomberg) -- Terms of Trade is a daily newsletter that untangles a world embroiled in trade wars. Sign up here.
Canadian retail sales beat forecasts in June, keeping the economy on track for what’s anticipated to have been a strong second quarter of growth.
Receipts for the nation’s retailers were little changed in June, Statistics Canada reported on Friday. Economists were expecting a 0.3% decline.
Excluding sales at gasoline stations and car dealerships, retail sales climbed 1.7%, the most since January 2017, aided by the Toronto Raptors’ playoff run.
In volume terms, sales were up 0.4% in June, better than what has been typical of late and a stronger-than-expected end to the second quarter.
Friday’s retail report is the last bit of economic data for the second quarter, with GDP numbers due Aug. 30. The retail numbers are likely to reinforce expectations that second quarter GDP growth was near 3% on an annualized basis, probably enough to keep the central bank on the sidelines for now.
“The decent finish to the quarter gives some momentum for Q3, a reason why we see the Bank of Canada delaying a rate cut for several more months,” Avery Shenfeld, chief economist at Canadian Imperial Bank of Commerce said in a note to investors.
Even with the flat June results, Canada’s retail sector was able to eke out half decent gains in the second quarter with sales up 1.2% in nominal terms and volumes up 0.1%.
Canadian retailers have been in a bit of a slump for more than a year. Volume sales remain below records hit earlier last year. While the second quarter increase in volumes was small, it was the first gain since the third quarter of 2018.
The Toronto Raptors playoff run seems to have given a boost to June numbers, helping sales at clothing retailers, sporting goods stores and bars. The Raptors won their first National Basketball Association title in June. Sales of Raptors championship apparel and memorabilia on NBA.com broke the record for the day following a title, topping LeBron James’s 2016 victory with his hometown Cleveland CavaliersReceipts at gas stations fell 3.4%, largely on falling pricesCar and parts dealerships recorded a 2.5% decline in sales, mostly on lower volumesBuilding materials and gardening equipment gained 6% in June, helped by improving weather during the month
--With assistance from Erik Hertzberg.
To contact the reporter on this story: Theophilos Argitis in Ottawa at firstname.lastname@example.org
To contact the editors responsible for this story: Theophilos Argitis at email@example.com, Chris Fournier
For more articles like this, please visit us at bloomberg.com
©2019 Bloomberg L.P.