Retail sales rise more than expected in June

Retail sales rose more than expected in June, as Canadians opened their wallets to spend more on electronics andgasoline.

Statistics Canada said retail sales were up 0.6 per cent in June from the month before, triple market expectations. The increase was led by a 9.4 per cent surge in electronics and appliance store sales.

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Stats Can said that growth was driven bystronger sales of phones and home office electronics, which the agency said coincided with new rules that limited the duration of cellphone contracts.

Gas station sales rose by 2.6 per cent in the month as prices at the pump rose.

Sales rise in all provinces

But factoring out the effect of any price changes, the volume of sales was unchanged.

Retail sales were up in all 10 provinces in June, led by British Columbia and Ontario.

In the first six months of the year, retail sales were up 2.2 percent compared with the first half of 2014.

Looking ahead, economists say July's retail sales report, due to be released in September, will likely show another increase. "In the near term, household spending can be expected to pick up, as Canadian families spend the windfall received from the federal government in the form of enhanced Universal Child Care Benefit payments," said TD economic analyst Admir Kolaj in a commentary.

"We expect the lump-sum payment received in July to contribute about 0.4 percentage points to annualized real GDP growth in [the third quarter], with the effect fading thereafter."