Canadian retail sales likely to have rebounded in October on stronger auto sales

Canadian retail sales data for the month of October is set to release tomorrow. According to a TD Economics research report, the retail sales are likely to have grown 0.5 percent in the month, owing to stronger auto sales and a 0.3 percent rise in ex-autos measure.

Preliminary motor vehicle sales recorded a sharp rise in October, aided by unseasonably warm weather, which implies a full recovery of the fall seen in the prior month.

Meanwhile, increased gasoline prices are expected to have flattened nominal sales at the pump while a strong rise in hours worked augurs well for the retail sector as a whole.

“Real retail sales should match the nominal increase, reflecting little change to consumer goods prices, which should help anchor Q4 consumption after a disappointing (-0.1 percent) handoff from September”, added TD Economics.