MNI: Canada Oct Flash Retail Sales Flat After Sept Decline

Statistics Canada on Friday said flash retail sales were little changed in October after falling 0.7% in September on lower automobile purchases, suggesting consumer demand will make a weak contribution to third-quarter GDP.

September sales declined in six of nine categories led by a 2.9% decrease in autos and parts. Excluding autos receipts climbed 0.2% on the month.  

Third quarter sales were up 0.2% but declined 0.3% in volume terms more closely linked to GDP. Statistics Canada reports third-quarter GDP next Friday, and economists predict a weak gain of less than 1% at an annualized rate after a second quarter decline. 

The Bank of Canada cut its policy rate a quarter point to 2.25% on Oct. 29 and officials said they've probably done enough to support an economy hurt by U.S. tariffs and ensure inflation stays near its 2% target. Some economists predict that high unemployment and fading exports mean they will cut again early next year, even though the last two job reports have shown unexpectedly large employment gains. 

The Bank sees consumer spending growth slowing to 1.5% over the next two years from 2.8% this year on slowing population growth and confidence weakened by the trade war.