OTTAWA (Reuters) -Canada’s retail sales in September grew at a strong pace as consumers spent more at grocery stores and supermarkets, data showed on Friday, the first quarterly increase in sales this year.
The solid pace in September which took the overall third quarter growth in retail sales to 0.9%, is likely to be followed by 0.7% in October, a preliminary estimate by Statistics Canada said.
The robust October number suggests that the fourth quarter could start on a strong note and help prop up economic growth, which the Bank of Canada has said is a cause of concern and has hoped to boost through rate cuts.
Currency markets trimmed their bets for a 50 basis point reduction in interest rates next month to 18% from 21% before the retail sales data was released. They see an 82% chance of a 25 basis point rate cut on Dec. 11.
Retail sales, which comprise purchases of motor vehicles, clothing, furniture, food and beverages among others, grew by 0.4% in September on a monthly basis, Statscan said.
This was similar to the rise seen last month and matched estimates by analysts, with the total value of sales at C$66.94 billion ($47.91 billion).
Core retail sales, which exclude sales at gasoline stations and fuel vendors and motor vehicle and parts dealers, were up 1.4% in September, the statistics agency said.
In volume terms sales were up 0.8% in September.
The bulk of the growth came from transactions seen at food and beverage retailers, which contribute around a fifth of the total retail sales. They grew by 3% in September.
But other sectors also contributed with six out of nine subsectors in the retail sales category posting a growth in sales, the data showed.
($1 = 1.3971 Canadian dollars)
