Canada Retail Sales Fall in July Amid Trade Uncertainty

CANADA RETAIL SALES SLUMP IN JULY

Canadian retail sales declined more than expected in July, dropping 0.7% month-on-month after a solid gain of 0.6% in June.

The data point to a softer consumer sector, which is closely watched as an early indicator of economic activity, with household consumption accounting for a significant share of Canada's economy.

CIBC analysts noted that Canadian consumers spent cautiously in July and expect lingering trade uncertainty to weigh on discretionary spending ahead.

The decline was broad-based, affecting eight out of nine subsectors, including general merchandise retailers and clothing-related sales. Motor vehicle and parts dealers also saw a 0.8% drop, while e-commerce sales fell by 3.5%.