Canada's retail sales fall 0.7% to $73.7 billion in July, led by general merchandise and clothing

Statistics Canada reported on 24 September 2026 that retail sales fell 0.7% to $73.7 billion in July, close to the 0.8% decline its advance estimate had pointed to the week before (preview). It follows a 0.6% rise to $74.3 billion in June.

The July numbers

• Total retail sales: down 0.7% to $73.7 billion; in volume terms, sales fell 1.1%
• Subsectors: eight of nine subsectors declined, led by general merchandise retailers, down 1.9% after rising 2.5% in June
• Clothing, accessories, shoes, jewellery, luggage and leather goods: down 1.2%
• Motor vehicle and parts dealers: down 0.8%, their first decline in four months, led by new car dealers (down 1.3%); used car dealers rose 2.9%
• Gasoline stations and fuel vendors: down 0.9% for a second straight monthly decline; down 3.5% in volume terms
• Building material and garden equipment dealers: the only subsector to rise, up 0.8% for a fourth consecutive month
• Core retail sales (excluding gasoline stations, fuel vendors, and motor vehicle and parts dealers): down 0.7%, following a 1.2% rise in June

By province

Retail sales fell in five provinces. Ontario had the largest decline in dollar terms, down 2.0%, driven by general merchandise retailers; in the Toronto census metropolitan area, sales fell 4.7%. British Columbia was down 1.4%, led by motor vehicle and parts dealers, with Vancouver down 1.6%. Alberta had the largest increase, up 1.4%, led by general merchandise retailers.

E-commerce and the outlook

Retail e-commerce sales fell 3.5% to $5.5 billion, or 7.5% of total retail trade, down from 7.7% in June. Statistics Canada's advance estimate for August points to a 1.3% rebound, based on responses from 57.8% of companies surveyed; the average final response rate over the previous year was 87.1%, so the estimate is likely to be revised.

What it means for the Canadian dollar

The Bank of Canada held its policy rate at 2.25% on 2 September for a seventh straight decision, citing uncertainty from the Middle East conflict and the breakdown of trade talks with the United States (report). A soft July for retail sales, alongside inflation holding at 3.0% in August (report) and home sales edging down (report), fits a picture of a economy the Bank isn't in a hurry to tighten further. Oil prices remain the other big driver of USD/CAD (oil and the Canadian dollar). The Bank's next decision is 28 October, and August retail sales follow on 23 October 2026.