Canadian consumers spent far more at retail stores than economists had expected in October, where sales rose 1% across a broad range of goods from food to cars.
Retail sales rose to $38.6 billion, their third straight monthly increase as gains were reported in seven of 11 subsectors representing 76% of retail sales, Statistics Canada reported Wednesday.
The 1% increase in retail sales was “nearly double the street’s call, and matches the hefty pace seen in the prior month,” CIBC World Market economist Emanuella Enenajor wrote in a note to clients.
“Looking at the details, gains were encouragingly broad-based, with increases in the majority of categories, including food, gasoline and autos.”
The Canadian consumer is a key driver of the country’s economic growth and evidence of spending supports predictions that the economy is still growing, despite increasing pressure from economic troubles around the globe.
While recent data have suggested that Canadians are continuing to spend, unemployment remains relatively low and the housing market has yet to cool significantly, government officials have warned that ultra-low interest rates meant to stimulate the economy could pose a serious threat.
Finance Minister Jim Flaherty and Bank of Canada governor Mark Carney have cautioned repeatedly that interest rates will eventually rise and that consumers racking up debt now could face financial difficulty paying it off down the road.
