Canada’s wholesale trade falls sequentially in September

Wholesale trade in Canada dropped in the month of September after rising for two months. Wholesale trade dropped 1.2 percent sequentially to CAD 62 billion. This is the second decline in this year. In terms of volume, wholesale trade fell 1.1 percent.

The fall in September is attributed to decreases in five of seven subsectors. The personal and household goods subsector recorded the largest decline in dollar terms in September, falling 4.8 percent to CAD 8.6 billion. This was the first drop since November 2016 and more than counters the 3.2 percent rise in August. All but one industry in this subsector recorded falls in September, driven by the textile, footwear and clothing industry. Sales in the beverage, food and tobacco subsector dropped 2.2 percent.

Wholesalers in the machinery, equipment and supplies subsector recorded a drop of 2.1 percent in the month. In the meantime, sales in the building material and supplies subsector rose 2.6 percent to CAD 8.9 billion in September, on the strength of gains seen by the lumber, millwork, hardware and other building supplies industry. Sales in the motor vehicle and parts subsector rose 1.4 percent to CAD 12 billion, driven by the motor vehicle industry.

Region wise, sales fell in eight provinces, led by Quebec and Ontario. Sales in Quebec fell 2.4 percent, the first drop in three months and the largest decline of all provinces in the month. Sales also fell in Ontario (-0.6%), British Columbia (-2.0%) and Saskatchewan (-5.7%). On the other hand, Alberta recorded a rise in sales of 0.6 percent.

Wholesale inventories increased 0.6 percent to CAD 81.1 billion in the month. This is the fifth rise in six months. In dollar terms, the machinery, equipment and supplies subsector recorded the largest gain after a decline of 1.2 percent in August.

The inventory-to –sales ratio rose to 1.31 in September from 1.29 in August.

At 16:00 GMT the FxWirePro's Hourly Strength Index of Canadian Dollar was bullish at 90.3402, while the FxWirePro's Hourly Strength Index of US Dollar was neutral at 34.3021. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex

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