Gas prices push up retail sales
Higher prices consumers paid for gasoline in May helped push overall retail sales for the month up by 0.4 per cent to $35.8 billion.
Economists had been looking for monthly sales growth of 0.6 per cent, which would have matched April's increase.
Statistics Canada said Tuesday that the advance in overall sales was primarily due to increased sales at gasoline stations, largely owing to gasoline prices that were 8.8 per cent higher in May compared with April 2008.
If the effects of price changes are removed, Statistics Canada said, retail sales in constant dollars rose by only 0.1 per cent.
Economists suggested the monthly retail sales report provided evidence that gasoline prices are affecting Canadians' driving habits.
"Note that despite the jump in gasoline prices in the month, service station receipts rose just 2.4 [per cent month-over-month], suggesting that drivers really did park it in the face of soaring prices," said BMO Capital Markets economist Douglas Porter.
Dina Cover, an economist at TD Bank, said "it is clear that Canadian consumers are feeling the impact of high energy costs and adjusting their consumption patterns accordingly."
May sales in the building and outdoor home supplies stores sector also rose 0.7 per cent, the second increase in eight months.
Among the three sectors where sales did not increase, the largest drop occurred in clothing and accessories, where activity fell by 0.7 per cent, due to a drop of 1.1 per cent in clothing stores. Sales at shoe, clothing accessories and jewelry stores rose 0.9 per cent following five consecutive monthly declines.
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