Canadian retail sales rose 0.4 per cent to $66.6 billion in August from the previous month. Compared to the same time last year, retail sales are also up by 1.4 per cent. However, core retail sales, which exclude gasoline and automobile items, were down 0.4 per cent month-over-month. In volume terms, adjusted for rising prices, retail sales rose 0.7 per cent in August.

Retail sales in British Columbia were down 1.0 per cent in August month-over-month, while down 0.6 per cent compared to the same time last year. In the CMA of Vancouver, retail sales were down 1.4 per cent from the prior month and unchanged from August 2023.

August's retail sales show some positive signs in Canadian consumption while highlighting underlying weaknesses that have remained a challenge throughout 2024. On one hand, headline sales rose for a second consecutive month, and we saw the largest year-over-year gain since April. However, contracting core retail sales—which exclude volatile items—demonstrate an unsatisfactory level of consumer spending across goods and services, supporting the Bank of Canada's decision to cut rates by 50 basis points earlier this week. Moving toward their next meeting, the Bank will monitor whether retail activity (headline and core), GDP growth, and employment strengthen. Positive trends in these areas, coupled with CPI inflation returning to its midpoint, would propel the Bank back onto its regular trajectory of 25 basis point cuts until reaching their neutral range. 

Copyright British Columbia Real Estate Association. Reprinted with permission.