Canadian retail sales set to rebound in fourth quarter

By Erik Hertzberg

(Bloomberg) — Canadian retail sales surged in November after posting a small decline the previous month, suggesting consumption rebounded modestly in the fourth quarter.

Receipts for retailers rose 1.2% last month, according to an advance estimate from Statistics Canada on Friday. That’d be the biggest increase in five months.

The drop followed a 0.2% decline in October, which was weaker than the flat expectation in a Bloomberg survey of economists. In volume terms, sales fell 0.6% that month. 

Sales in October fell in four out of nine subsectors and were led by decreases at food and beverage retailers. The agency said beer, wine, and liquor retailers contributed most to the decline in core retail sales, coinciding with labour disruptions in British Columbia, Canada’s westernmost province.

Motor vehicle and parts sales rose 0.6% in October, led by new cars and other motor vehicle dealers. Gasoline sales fell that month.

Retail sales are set to grow 0.3% in the last quarter of 2025, assuming the agency’s flash estimate is correct, and no growth in December. Receipts for retailers were flat in the third quarter.

It’s the latest in a string of data suggesting Canada’s economy is holding up better than expected, even as U.S. tariffs slam exports and weaken business investment. Household consumption shrank in the third quarter, according to gross domestic product data, but the strong retail receipts toward the end of the year suggest consumers are proving more resilient. That’s despite slowing population growth and families renewing mortgages at higher rates.

The increased spending may be partly due to a surge in household financial assets this year — Canadians’ wealth has been boosted by the increase in the value of North American stock. The Bank of Canada also trimmed interest rates by 100 basis points this year, adding some relief for borrowers.

The central bank has signalled a prolonged pause, and markets and most economists expect policy-makers to hold rates steady for most of 2026.

–With assistance from Mario Baker Ramirez.

©2025 Bloomberg L.P.

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Last modified: December 19, 2025