Retail sales slip in June as consumers pause after strong May

OTTAWA • Lower sales at gas stations and in the auto sector pulled down Canadian retail sales in June after they surged higher in May.

Statistics Canada said Wednesday retail sales fell 0.2 per cent in June to $50.7 billion.

The move lower came as the result for May was re- vised to show an increase of 2.2 per cent compared with an earlier reading on 2.0 per cent.

Economists had expected an increase of 0.1 per cent in June, according to Thomson Reuters Eikon.

“The Canadian consumer took a small pause in June, but only after a sprint the prior month, so this is hardly a weak result,” Bank of Montreal chief economist Doug Porter wrote in a report.

The retail sales figure followed a report Tuesday that wholesale sales fell 0.8 per cent to $63.1 billion in June.

Statistics Canada is expected to report secondquarter gross domestic product figures on Aug. 30.

TD Bank senior economist Brian Depratto said he expects the reading to show the economy grew at a 3.5-per-cent annualized rate in the second quarter.

“Slotting today’s data into the bigger economic picture does little to alter the assessment of the economy’s performance in the second quarter,” Depratto said. “With the economy performing well and core inflation measures solidly on target, the pieces are in place for another Bank of Canada policy interest-rate hike this fall.”

Sales at gasoline stations fell 2.3 per cent, in part due to lower prices at the pump in June, while sales at motor vehicle and parts dealers dropped 0.7 per cent.