Canada’s Retail Sales Jump 1.2% to C$74.6 Billion in August

Canadian retail sales climbed 1.2% in August to a seasonally adjusted C$74.6 billion, recovering from the previous month’s decline as sales increased in all nine major retail subsectors. Motor vehicle dealers provided the largest lift, but the improvement reached well beyond car showrooms.

The August total was C$74.567 billion, up from a revised C$73.685 billion in July, according to figures released Friday by Statistics Canada. Compared with August 2025, retail sales were 5.4% higher in current dollars. Once price changes were accounted for, the year-over-year increase was a more modest 2.0%.

In volume terms, retail sales also rose 1.2% from July. Because the inflation-adjusted increase matched the gain in current-dollar receipts, the national rebound cannot be explained by higher prices alone.

New-car sales rebound as spending at fuel retailers rises

Motor vehicle and parts dealers recorded a 1.2% sales increase in August and made the largest contribution to the national gain. New-car dealers were central to that recovery, with receipts up 1.5% after falling 1.4% in July. Automotive parts, accessories and tire retailers also posted a 1.4% increase.

The improvement was uneven within the automotive market. Used-car dealers reported a 0.5% decline, and sales at other motor vehicle dealers fell 1.4%. Those declines were not large enough to offset gains at new-car dealerships and parts retailers, according to the agency’s August retail trade release.

The inflation-adjusted numbers added to the picture. Sales volumes at motor vehicle and parts dealers increased 1.8% during the month, including a 2.4% rise at new-car dealers. These figures support the view that the automotive recovery involved more purchasing activity, rather than being explained solely by changes in selling prices.

Gasoline stations and fuel vendors moved in the opposite direction when measured in volume rather than dollars. Their sales receipts rose 1.7%, the first monthly increase in three months, but inflation-adjusted sales dropped 0.5%. More money flowing through fuel retailers therefore did not translate into a corresponding rise in the quantity of goods sold by those businesses. The split is an important limitation on interpreting the headline value of spending at the pump.

Core retail sales recover across everyday shopping categories

Retail sales excluding motor vehicle and parts dealers and gasoline stations and fuel vendors increased 1.1% in August, following a 0.7% decline in July. This measure, commonly called core retail sales, helps show whether the broader range of stores is participating in a monthly change rather than leaving the result dependent on cars or fuel.

Food and beverage retailers saw sales rise 1.1%, their first increase in three months. Statistics Canada reported higher receipts at each of the four store types within that category. General merchandise retailers, another sizeable component of routine shopping, gained 1.0% after a 1.7% decline the month before.

Health and personal care retailers increased sales by 1.6%, extending their run of monthly gains to 10 consecutive months. The persistence of that advance stands out from categories that have experienced more frequent reversals. It also shows why a single retail headline can conceal different patterns among the businesses contributing to it.

Looking at volumes strengthens the evidence of wider demand. Retail sales excluding both vehicles and fuel increased 1.3% in constant-dollar terms, compared with the 1.1% rise measured in current dollars. Total retail sales volume was 2.0% higher than a year earlier, even though the value of sales rose 5.4% over the same period. The difference between those annual rates illustrates how changes in prices affect the dollar figures.

Online retail spending also increased, though slightly less rapidly than overall sales. Seasonally adjusted e-commerce receipts rose 1.1% to C$5.6 billion, representing 7.6% of total retail trade. That figure measures the online portion of the retail market, not an additional category of spending to add to the national total. It also does not include every online purchase Canadians make, because services such as travel bookings fall outside the retail trade measure.

Ontario and British Columbia lead the provincial gains

The national increase did not translate into growth in every province. Six provinces reported higher retail sales, with Ontario registering the largest increase in dollar terms. Sales in Canada’s most populous province advanced 2.2% to C$28.541 billion, led by motor vehicle and parts dealers.

Ontario’s receipts were approximately C$604 million higher than in July. That represented a large part of the roughly C$882 million increase recorded across Canada. Retail sales in the Toronto metropolitan area rose 4.0%, exceeding the province-wide increase and underscoring the importance of that market to the month’s national result.

British Columbia posted a 2.1% advance to C$9.970 billion, also led by sales at motor vehicle and parts dealers. Retail sales in metropolitan Vancouver increased 2.1%. Manitoba and Saskatchewan registered gains of 1.6% and 1.1%, respectively, while Nova Scotia rose 0.6%.

Quebec’s increase was smaller at 0.2%, bringing retail receipts to C$16.222 billion. Within the province, metropolitan Montréal reported a 0.5% decline. Alberta’s retail sales edged down 0.1%, with lower sales at motor vehicle and parts dealers contributing to the decline. Newfoundland and Labrador, Prince Edward Island and New Brunswick each recorded decreases of 0.6%.

These regional differences matter when assessing the breadth of the rebound. All nine retail subsectors grew at the national level, but that does not mean every type of store or every local market had a stronger month. The provincial data suggest the largest boosts were concentrated in particular markets, especially Ontario and British Columbia.

September estimate points to another gain before Bank of Canada decision

Early survey responses suggest retail sales rose a further 0.7% in September. Statistics Canada cautioned that the figure is an unofficial advance estimate, calculated from responses received from 58.5% of surveyed companies. The average final response rate during the preceding 12 months was 86.8%, leaving room for the September reading to change as more information becomes available.

The signs of continued retail growth arrive ahead of the Bank of Canada’s October 28 interest-rate announcement and Monetary Policy Report. The central bank held its policy rate at 2.25% in September, citing inflation risks and uncertainty in the economic outlook. Stronger real retail sales provide one piece of evidence about demand, but cannot by themselves establish what decision policymakers will make.

Price pressures remain relevant to that assessment. Statistics Canada’s latest consumer price data showed annual inflation at 3.1% in September, up from 3.0% in August, with gasoline prices rising sharply from a year earlier. That backdrop reinforces the need to distinguish changes in the value of retail sales from changes in the volume of goods purchased.

The complete September retail trade release is scheduled for November 20. It will provide a fuller reading of whether the increase suggested by the advance estimate continued across sectors and regions, or changed as the survey results were finalized.