Canada's Consumer Spending Accelerates Amid Fuel Price Hikes

Canadian consumers have been maintaining their consumption patterns despite weak real wage gains and higher energy costs. According to RBC's Q2 cardholder transactions, overall spending accelerated in the second quarter, but this gain was largely due to increased fuel prices. When excluding gas station spending, core retail sales rose by 2.4% from the previous quarter.

The Labor Department reported that US inflation declined slightly in July, with consumer prices increasing 3.4% year-over-year, down from 3.5% in June. However, prices are still rising more quickly than before the Iran war and pose challenges for the White House ahead of the midterm elections.