Canada’s economy recorded a flurry of activity in October, according to preliminary data, potentially casting doubt over the extent of an expected slowdown in the fourth quarter. Statistics Canada released advance estimates for retail that showed sales rising 1.5% in October. Separately, the agency said wholesale activity rose 1.3% during the month, while factory sales were up 2%. The agency provided few details, however, and it’s not clear how much rising prices were driving the gains.

The reports come with most economists anticipating a sharp slowdown in growth. But this new data suggests that business activity and household spending remain resilient in the face of high inflation and rising interest rates.

The 1.5% increase in retail sales would be the largest since May and followed a small drop in retail sales of 0.5% in September. A big part of the rebound last month may reflect rising gasoline prices, though the statistics agency didn’t provide details of what drove the October number. Retail sales likely benefited from a 9.2% rise in prices for gasoline.

The September decline matched the median estimate in a Bloomberg survey. Sales dropped in seven of the 11 subsectors, representing 74.9% of retail trade. It was led by lower sales at gasoline stations and food and beverage stores.

The agency said the rise in manufacturing sales in October was led by food, chemical and petroleum. The pickup in sales at wholesalers was led by building material and supplies.

Retail sales were down 1.0% in the third quarter, or 1.4% in volume terms, Statistics Canada said.

Source: Financial Post