Economy

Retail sales rise 0.6% in June to $74.3B, but July flash points to a pullback

Canadian retail sales grew in seven of nine subsectors in June and volumes jumped 1.5%, though Statistics Canada's early estimate shows a 0.8% drop in July.

By John Wilson · August 21, 2026

Canadian shoppers ended the second quarter on a strong note. Statistics Canada reported on Friday that retail sales rose 0.6% to $74.3 billion in June, with gains in seven of nine subsectors led by general merchandise retailers.

The bigger surprise was in volumes. Adjusted for price changes, retail sales rose 1.5% in June, a sign that consumers were buying more goods, not just paying more for them. The agency's early estimate for July, however, suggests sales fell 0.8% to start the third quarter.

The numbers

Core retail sales, which exclude gasoline stations and motor vehicle dealers, rose 1.2%, a second consecutive monthly gain. The headline was held back by a 4.1% drop in sales at gasoline stations and fuel vendors, their first decline in four months.

Retail e-commerce sales rose 9.9% to $5.7 billion, or 7.7% of total retail trade, up from 7.1% in May. For the second quarter as a whole, retail sales rose 2.2%, or 0.4% in volume terms.

General merchandise retailers: +2.7%
Clothing, shoes, jewelry and accessories: +3.1%
Motor vehicle and parts dealers: +1.0%, a third straight gain, with new car dealers up 1.5%
Food and beverage retailers: -0.4%, the only core decline, with supermarkets down 0.6%

Regional picture

Ontario posted the largest dollar increase, with sales up 1.6% and the Toronto census metropolitan area up 3.9%. Quebec sales rose 0.5%, with Montréal up 1.0%. Alberta recorded the largest decline, down 1.3%, led by lower sales at gas stations.

Economists read the report as a solid one. CIBC senior economist Andrew Grantham said "the underlying trend still appears to be gradually upwards." TD economist Maria Solovieva wrote that the data "point to ongoing real personal consumption growth in Q2 despite rising prices."

The caveats

The July flash estimate tempers the good news. Statistics Canada stressed that the 0.8% decline is based on responses from 56.5% of surveyed companies, compared with an average final response rate of 87.3% over the previous 12 months, so it will be revised.

The timing is also awkward. The report landed on the same day Canada-U.S. trade negotiations broke down, raising the risk of new tariffs on Canadian goods. Higher costs and job uncertainty in exposed sectors could weigh on spending in the months ahead, and the drop in gas station sales mostly reflects price swings rather than a change in how much fuel people buy: in volume terms, fuel sales rose 4.2%.

What it means for you

Strong spending in June suggests households were still willing to open their wallets, but the early July figure and the trade backdrop argue for caution rather than complacency.

For a household budget, it can be a good moment to review fixed and discretionary spending, top up an emergency fund and avoid taking on new high-interest debt while the economic outlook is unsettled. For investors, retail data is one input among many; consumer-facing stocks can be sensitive to swings in confidence. This is general information, not personalized advice.

Sources

General news and information, not individualized financial advice. Figures reflect the publication date.