Release Date: August 22, 2012
May Result: Retail Sales 0.3% M/M; Ex-autos 0.5% M/M
TD Forecast: Retail Sales 0.0% M/M; Ex-autos 0.2% M/M
Consensus: Retail Sales 0.1% M/M; Ex-autos 0.2% M/M
While a stronger pace of hiring emerged over Q2, the combination of an uncertain global backdrop, lower gasoline prices and weak auto sales (as noted by industry data) are expected to leave the consumer spending unchanged in the month of June. The core measure - which excludes autos - is forecast to rise by a modest 0.2% during the month. After adjusting for the impact of changing prices, retail sales volumes are expected to be more constructive for industry-level real GDP.
Canada Inflation Drops In July 2012
Headline CPI inflation declined to 1.3% y/y in July from 1.5% y/y in June (top chart). Core CPI inflation was also down to 1.7% y/y from 2.0% y/y a month before. On a monthly basis, headline CPI (-0.1%) and core inflation (-0.1%) were both down. On a seasonally adjusted basis, headline CPI was down 0.1% and core prices remained unchanged. Only 4 of the eight broad CPI categories saw increases (SA). There were notable price decreases for clothing and footwear (-0.9%) and transportation (-0.8%) and gains for food, household operations, and shelter. On a regional basis, 8 provinces experienced lower price pressures in July (y/y), the sharpest decline being observed in Newfounland & Labrador (from 2.2% to 1.6%).
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