Talking Points:
- Retail Sales m/m at 0.7% vs expected 1.2%
- Retail Sales ex-autos 1.1% vs expected 1.3%
Canadian Retail Sales
below estimated figures demonstrating consumer spending has begun to slow even before renewing restrictions within the provinces. Retail Sales has been holding up better than expected for the past few months but, it’s becoming unclear how sales will hold up with a surge in cases.
The increase to $58.1 billion in November was driven by higher sales at gasoline stations (+4.9%), building material, garden equipment and supplies dealers (+3.0%) and food/beverages stores (+1.0). Sales increased in 6 of 11 subsectors representing 63.8% of retail trade.
Canadian Dollar
saw a relatively muted reaction to the retail sales figures given that external factors are a more dominant theme at present. What's more, given that the figures are for November, the data is somewhat outdated, particularly in the context that this does not capture the Omicron impact.
Created by Kaithleen Pesantez
Canadian Outlook
With recent figures of consumer spending we are seeing an economic slow down, however inflation at an all time high, the likelihood of interest rate hikes from the Bank of Canada next week is growing. This would be the first of many and the Bank of Canada is expected to raise the overnight rate by 25 basis points by next week.
--- Written by Kaithleen Pesantez, Market Strategist for DailyFX.com
Contact and follow Kaithleen on Twitter: @ktpesantez
