Retail sales declined 0.3% in August as consumer spending across Canada begins to slow amid high interest rates.
The drop in August represented the first decline in retail sales since March of this year, according to Statistics Canada.
The August figure is a preliminary estimate that was released alongside July retail sales, which showed an increase of 0.3% month-over-month.
Retail sales during July rose in seven of nine subsectors and were led by increases in food and beverage items. Motor vehicle and parts dealers saw the largest decrease in July, declining for the first time in four months.
In volume terms, retail sales in July fell 0.2% from June.
The report suggests that Canadians are slowing their spending as they grapple with higher interest rates and higher gasoline prices at the pump.
The Bank of Canada held its trendsetting overnight interest rate at 5% at its last policy meeting on September 6, saying that higher rates are helping to lower inflation.
However, gasoline prices have been trending upwards in recent months, with crude oil now trading above $90 U.S. per barrel, its highest level in nearly a year.
Additionally, 17% of Canadian retailers said the strike at British Columbia seaports in July of this year negatively impacted their business, according to Statistics Canada.
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