Canada: Retail Sales rise by 1.6% MoM in October versus 1.0% forecast

• Canadian Retail Sales rose 1.6% MoM in October and likely rose 1.2% MoM in November, according to Statistics Canada. 
• The loonie was unmoved, with investors more focused on Thursday's GDP report.  

According to a report released by Statistics Canada on Tuesday, Canadian Retail Sales rose 1.6% MoM in October, more than the expected 1.0% rise and a sharp acceleration from September's 0.6% MoM decline. Statistics Canada's flash estimate for November showed that Retail Sales most likely rose 1.2% MoM in November, suggesting continued strong momentum.

The Core measure that excludes auto purchases was up 1.3% MoM, also stronger than consensus estimates, which was for a 0.8% MoM gain. As with the headline readings, the ex. autos measure of Retail Sales also accelerated sharply on the month from September's 0.2% MoM drop. 

Market Reaction

The loonie has not reacted to the latest retail sales report, with USD/CAD continuing to move sideways in the 1.2920 area. Loonie investors will be more interested in the release of October GDP numbers on Thursday, which will provide an early indication as to how the Canadian economy faired at the start of Q4.