Bloomberg News

Canadian September Wholesale Sales Decline on Cars, Goods

November 20, 2012

Canadian wholesale sales fell at the fastest pace in 19 months in September, with automobiles and personal goods leading declines across every major category.

Sales dropped 1.4 percent in September to C$48.8 billion ($49 billion), Statistics Canada said today in Ottawa. The agency pared its estimates for the prior two months. The decline exceeded all 13 forecasts in a Bloomberg economist survey with a median estimate of a 0.5 percent increase.

Receipts have stagnated after reaching a record C$50 billion in May, and today’s report is another sign that global strains are slowing the world’s 11th largest economy. Bank of Canada Governor Mark Carney has said global businesses are delaying investment decisions because of uncertainty about the measures policy makers are taking to revive economic growth.

“It’s pretty bad; it reaffirms the weak quarter that we have had in Canada,” said Mazen Issa, Canada macro strategist at TD Securities in Toronto. “The 1 percent quarterly growth rate expected by the Bank of Canada looks a bit strong at the moment” for the third quarter, he said.

The Canadian dollar was little changed at 99.68 cents versus the U.S. dollar at 9:44 a.m. in Toronto. One Canadian dollar buys $1.0031.

Motor vehicle and parts sales fell 4 percent in September to C$8.03 billion, the third straight decline, Statistics Canada said. Excluding the automobile category, sales fell 0.8 percent.

Major-Category Declines

Personal and household goods sales fell 2 percent to C$6.83 billion. Machinery and equipment dropped 1 percent to C$10.8 billion.

All seven major categories tracked by the agency fell in September, Statistics Canada said. About 85 percent of the total decline came from the automobile, personal goods and machinery categories.

The volume of wholesale sales, which removes the impact of price changes, fell 1.3 percent.

Statistics Canada today also reduced the estimated gain for August to 0.3 percent from 0.5 percent, while widening the July decline to 0.9 percent from 0.7 percent.

Wholesale sales were 2.2 percent higher in September than the same month a year earlier, the slowest pace since December 2009.

Inventories fell for the first time in 10 months in September, by 0.4 percent to C$61.4 billion. The inventory-to- sales ratio, a measure of how many months it would take to deplete stocks at the current sales pace, rose to 1.26 in September from a revised 1.25 in August.

To contact the reporter on this story: Greg Quinn in Ottawa at gquinn1@bloomberg.net

To contact the editors responsible for this story: David Scanlan at dscanlan@bloomberg.net; Chris Wellisz at cwellisz@bloomberg.net


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