American retailers have had nothing but bad news since the holiday shopping season kicked off, but that doesn’t mean the same sad song is playing over mall speakers throughout North America. In fact, crossing the northern border will land brands in slightly happier circumstances.
The Wall Street Journal reported that unlike their U.S. counterparts, Canadian retailers are seeing increasing sales from October data. Working on information provided by Statistics Canada, WSJ explained that the seasonally adjusted sales total had risen 0.1 percent to $31.15 billion. Though experts had previously forecasted a boost of around 0.4 percent, higher overall prices on products helped buoy profits, despite a plateau in overall sales.
Reuters posted a detailed breakdown of the statistics, with clothing and accessories enjoying a modest 1.9 percent boost in sales. However, the normally insulated vertical of grocery and food services fell by 1.2 percent. However, those working in Canada’s electronics and appliance sector would take that figure any day of the week; that industry posted a 2.1 percent decline in sales, the fourth straight month of sub-par performance.
While retail might be experiencing a modest boost, David Madani, senior Canada economist at Capital Economics, told CTV News that the flat statistics on the remainder of the economy do not necessarily bode well for the country’s financial future coming out of the holiday shopping season.
“Overall, with the economy stagnating this quarter, the amount of excess slack will increase, creating more downside risk to the Bank of Canada’s outlook for underlying inflation,” Madani said. “This supports our long-held view that another interest rate cut is likely early next year, probably in April, though possibly sooner if oil prices fall any further.”
It might take Canadian retail a few months longer, but most signs point to it joining its American counterpart in the realm of less-than-encouraging sales numbers.