By Ketki Saxena
Investing.com -- Statistics Canada today reported that Canadian retail sales rose by 0.9% in April to C$60.72 billion, beating expectations for an increase of 0.8%.
Today’s reading represents a substantial increase from 0.2% growth in March (revised from an initial 0% reported expansion), as retail continues to bounce back from the repeal of Covid-19 restrictions.
The increase in retail sales was boosted by general merchandise stores, which gained 4.2%. Sales at miscellaneous store retailers, which includes pet stores, cannabis stores, office supplies and stationery stores and pool retailers, rose 11.3%.
Sales were up in six of the 11 sub sectors tracked by Statistics Canada, representing 43.3% of retail trade. Statistics Canada further announced that early estimates for retail sales in May suggest a gain of 1.6%, but cautioned the figure will be revised.
The robust retail indicates the resilience of consumer spending in the face of high inflation, rising rates, and slowing economic growth, and further raises bets for a 75 basis point hike from the Bank of Canada in July.
The Canadian dollar strengthened against its U.S. counterpart following the reading, with FX street noting that the “Stronger domestic data would be enough to provide a fresh lift to the Canadian dollar and pave the way for an extension of the pair's recent pullback from the YTD peak, around the 1.3080 region touched last Friday."