Retail sales reached $57.2 billion dollars in July, up 4.8% compared with the same month a year prior. This marked the second consecutive increase in year-over-year sales for the sector, as COVID-19 restrictions eased and regions across the country continued to reopen. Higher sales were reported in 12 of the 19 commodity categories.

Looking ahead to August, the advance estimate provided by the Monthly Retail Trade Survey suggests that unadjusted total retail sales increased by 1.7%. Owing to its preliminary nature, this figure should be expected to be revised.

Essential goods eat into total retail spending
Even with COVID-19 restrictions easing across the country, Canadians continued to eat at home more, with sales of food showing the largest year-over-year increase (+12.1%) for the fifth consecutive month. While food and beverage sales continue to represent a larger than normal share of consumer spending in the sector, this share has declined considerably from the record high seen in April (38.0%). Increasing sales in beverages (+14.8%), were led by alcohol, up 14.3% from a year earlier.

Sales at the pump
For the second consecutive month, the sale of automotive and household fuels represented the largest decline in the sector, down 22.4% from the previous year in July. This decline was primarily due to automotive fuels, with sales at the pump down $1.1 billion on a year-over-year basis. With restrictions continuing to ease and consumers travelling locally, increasing demand and prices resulted in shrinking declines in sales of automotive fuels when compared with the previous three months.

Non-essential spending soars
With many travel restrictions still in place for the month of July, consumers sought out local substitutes for travel and recreation. Enjoying the summer weather, consumers had higher than normal spending on products to be enjoyed outdoors, including recreational vehicles (+47.3%) and sporting and leisure categories (+29.8%). Consumers continued to spend on items around the house, led by strong growth in sales of hardware and renovation supplies not elsewhere classified (+83.3%), major home appliances (+20.2%) and small home appliances (+41.3%).

Source: Statistics Canada