Canadian retail sales fell in July as households pulled back on grocery and clothing purchases, while gains in auto sales and e-commerce provided only partial relief.
In July, the retail sales dropped 0.8 per cent to $69.6 billion, erasing some of June’s gains. Sales were also down 0.8 per cent, underscoring a real decline in consumer activity.
The downturn was broad-based, with eight of nine subsectors recording lower sales. Food and beverage retailers led the decline, slipping 1.3 per cent on weaker grocery receipts. Supermarkets and other grocery stores saw sales fall 2.5 per cent in July, reversing a 2.6 per cent increase the previous month. Beer, wine and liquor outlets stood out as the only group in the subsector to register growth, up 3.2 per cent.
Clothing, accessories, shoes and related goods also weighed on the monthly results, falling 2.9 per cent. Within that subsector, clothing and accessories retailers posted a 3.2 per cent drop.
Core retail sales, which exclude gasoline stations, fuel vendors and motor vehicle dealers, fell 1.2 per cent in July after climbing 2.2 per cent in June.
The auto sector offered a small offset. Sales at motor vehicle and parts dealers edged up 0.2 per cent, driven by a five per cent increase at other motor vehicle dealers and a marginal gain at new car dealers. Used car dealers and auto parts retailers posted modest declines.
Gasoline stations and fuel vendors recorded a 0.9 per cent drop in dollar terms. Adjusted for prices, however, sales volumes at the pump were up slightly, by 0.2 per cent.
Provincially, declines were concentrated in Ontario and Newfoundland and Labrador. Ontario, the country’s largest retail market, saw sales fall 1.6 per cent, led by lower spending on motor vehicles and parts. In Toronto, sales were also down 1.6 per cent. Newfoundland and Labrador posted the sharpest provincial drop at 8.8 per cent, coinciding with widespread wildfires in the province. Quebec stood out as a bright spot, with sales edging up 0.2 per cent and Montréal posting a 0.7 per cent gain.
E-commerce continued to expand. Online sales rose 2.2 per cent to $4.3 billion in July, accounting for 6.1 per cent of total retail trade, compared with six per cent in June.