Retail sales fell 0.5% to $61.1 billion in September led by a drop in sales at gas stations along with food and beverage stores, Statistics Canada said Tuesday.
However, the agency said its initial estimate for October pointed to a gain of 1.5% for the month, though it cautioned the figure would be revised.
“Retail sales fell in September; though the drop was smaller in volume terms, real spending took a notable step back in the third quarter,” BMO economist Shelly Kaushik wrote in a report.
“However, solid advance estimates for retail and manufacturing sales, as well as wholesale trade, point to a recovery in October.”
For September, Statistics Canada said sales at gas stations fell 2.4% as sales in volume terms at gas stations rose 4.2%, but gas prices fell 7.4%.
Meanwhile, sales at motor vehicle and parts dealers were relatively unchanged as sales at used car dealers slipped 3.5%, offset by a 2.3% gain at other motor vehicle dealers and automotive parts, accessories and tire stores rose 0.4%.
Sales at food and beverage stores dropped 1.3% in September, as supermarkets and grocery store sales fell 1.6% and convenience stores lost 1.5%.
Building material and garden equipment and supplies dealers saw sales fall 2.0%.
Core retail sales — which exclude sales at gasoline stations and motor vehicle and parts dealers — fell 0.4% in September.
In volume terms, retail sales fell 0.1% in September.
Retail sales for the third quarter as a whole were down 1.0%, the first quarterly decline since they fell 11.9% in the second quarter of 2020 at the start of the pandemic.
Retail sales in volume terms were down 1.4% in the third quarter of 2022.