Increased car sales gave the economy a boost, pushing retail sales up by 0.8 per cent in October from the previous month, the eighth consecutive gain in the last 10 months.
Statistics Canada says total retail sales rose to $35.3 billion in October and the amount of sales returned to levels that were last seen during the holiday season in 2008, before sales plunged amid the recession.
The auto sector was the biggest contributor to the larger numbers, with a 3.0 per cent gain overall in October. Sales of new vehicles increased for the sixth straight month, and were up 3.6 per cent. Sales at gas stations also saw an increase of 2.5 per cent, but they still lag behind the peak seen in the summer of 2008, when prices skyrocketed.
The auto industry continues to turn itself around, with October being the first month this year where the value of new car sales was higher than it was in 2008.
BNN's Michael Kane told Â鶹´«Ã½ Channel that year over year comparison numbers on car sales will grow stronger as Canada leaves the recession behind.
"Sales of cars are (now) pretty much where they were before the worst of the economic downturn started to hit one year ago," he said, explaining people are beginning to spend on cars again after pent up demand.
He said the numbers for other sectors were in line with predictions.
But excluding the help from the auto sector, retail sales actually went down 0.2 per cent in October. Five out of seven sectors dropped.
Clothing stores and building supply stores were the only sectors to see gains, and saw jumps of 1.6 per cent and 1.2 per cent respectively. Clothing stores saw the biggest increase since January.
Shoes, accessories and jewellery had some of the biggest gains with a 2.8 per cent jump.
But sales at grocery stores were down 1.1 per cent, and alcohol sales at beer and liquor stores fell 2.2 per cent after increases in August and September.
"That's a big drop," Kane said.
"What economists tell me is that it shows that discretionary spending was weaker than expected," he said.
Retail sales grew in some provinces in October, with Ontario contributing most to the increase with 1.3 per cent growth. That is the fifth gain over the last six months.
Sales also went up in Newfoundland and Labrador, Nova Scotia, and British Columbia.
But sales stayed flat in New Brunswick and Quebec, and Prince Edward Island saw a decrease of 1.7 per cent.
Kane said Canadians can expect to see better and better sales figures into the first half of 2010.
