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Economic News

Retail Sales Post Broad-Based Gains in August

October 23, 2026
Nom du rédacteur
Florence Jean-Jacobs
Principal Economist

Highlights

  • Retail sales rebounded by 1.2% m/m in August, one tick below Statistics Canada’s earlier flash estimate and the survey of economic forecasters. 
  • The advance was broad-based, with automotive and parts the main contributor in dollar terms (1.2%). See table for details.
  • Despite a slight drop in volumes month-to-month, gasoline and fuel sales were up 1.7%, due to higher prices.
  • Core sales, which exclude autos and gasoline, rose by 1.1%, with sales at food and beverage retailers, general merchandise retailers and health and personal care stores posting notable gains.
  • In constant dollars, real retail sales advanced 1.2% in August as retail prices were broadly unchanged (graph 1).
  • Most provinces posted higher retail sales in August, with considerable gains in Ontario (2.2%) and Toronto (4.0%).
  • Statistics Canada’s advance indicator for September points to another increase (0.7%). With seasonally adjusted CPI goods growing by 0.7% that month, this implies volumes stayed flat.
  • If the flash estimate proves correct, Q3 real retail sales would have grown by 3.4% q/q annualized, compared to 1.4% in Q2 and 6.5% in Q1. 

Implications

Canadian consumers opened their wallets in August, and this time, it wasn’t just a price story. Sales volumes grew by a solid 1.2%, compensating for the drop experienced in July. And Q3 sales data point to an acceleration of growth in retail volumes q/q, despite softness in July and a halt in growth in September. Consumers are still on an uncertain footing, caught between high energy prices taking a bite out of purchasing power and an uneven labour market External link.. In fact, despite resilience in retail data, spending intentions actually decreased slightly in Q3, according to the Bank of Canada’s latest consumer survey (graph 2). This could reflect a deteriorating outlook after Canada–US trade negotiations broke down on August 21 and Canada enacted counter-tariffs on September 8. Indeed, consumers’ long-term inflation expectations rose in Q3, with trade tensions and energy prices remaining key inflation concerns.

Following today’s release, our real GDP tracking for Q3 remains around 2%. Resilient spending reinforces our view that the Bank of Canada will raise rates next week. But, as per our latest forecast External link., household consumption and GDP growth are likely to slow in Q4. 

NOTE TO READERS: The letters k, M and B are used in texts, graphs and tables to refer to thousands, millions and billions respectively. IMPORTANT: This document is based on public information and may under no circumstances be used or construed as a commitment by Desjardins Group. While the information provided has been determined on the basis of data obtained from sources that are deemed to be reliable, Desjardins Group in no way warrants that the information is accurate or complete. The document is provided solely for information purposes and does not constitute an offer or solicitation for purchase or sale. Desjardins Group takes no responsibility for the consequences of any decision whatsoever made on the basis of the data contained herein and does not hereby undertake to provide any advice, notably in the area of investment services. Data on prices and margins is provided for information purposes and may be modified at any time based on such factors as market conditions. The past performances and projections expressed herein are no guarantee of future performance. Unless otherwise indicated, the opinions and forecasts contained herein are those of the document’s authors and do not represent the opinions of any other person or the official position of Desjardins Group.