People wear face masks as they shop in a department store in Montreal, Sunday, Aug/ 2, 2020. On the heels of double-digit growth in May, clothing and clothing accessories stores posted a 142.3-per-cent gain in June, Statistics Canada reported. (Graham Hughes/THE CANADIAN PRESS)

Retail sales in Canada jump 23.7%, reach pre-pandemic levels

Retail sales in Canada soared 23.7 per cent in June to $53 billion, climbing above February levels for the first time since the COVID-19 pandemic walloped the country’s economy, the national statistics agency reported Friday.

Statistics Canada says sales were up in all types of stores, but cars and car parts, along with clothing and accessories, led the way.

It added that early estimates suggest retail sales increased by 0.7 per cent in July.

Economists on average had expected an increase of 24.5 per cent for June, according to financial markets data firm Refinitiv.

Retail sales in volume terms were up 22.9 per cent in June, according to the data agency.

The motor vehicle and parts sales were up 53.4 per cent in June.

And on the heels of double-digit growth in May, clothing and clothing accessories stores posted a 142.3-per-cent gain in June.

“It’s a V-shaped recovery for retail sales despite all the doom and gloom in recent months,” Bank of Montreal economist Benjamin Reitzes said in a research note. “Hard to believe anyone would have expected this just a few months ago.”

Still, many sectors of the economy continue to struggle with the pandemic, Reitzes said.

Royce Mendes, senior economist at CIBC World Markets, said that while total retail sales are now above their pre-pandemic levels, some of that is simply a reflection of what’s included Canada’s retail sales numbers and what’s left out.

“Household spending on services is not included, and that’s an area that has been hit particularly hard by social distancing measures,” Mendes wrote in a research note. “Indeed, unlike the U.S., Canada’s retail report doesn’t even include restaurants, which remained well below its pre-pandemic levels in June.”

Reitzes said overall, the June economic data were stellar across the board and represent “an excellent jump off point” for the third quarter.

With files from CBC News and The Canadian Press

Categories: Economy, Society
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