Retail sales in Canada showed signs of recovery last month after a decline in the previous month.

 However, this recovery did not compensate for the decline recorded during the second half of  the current year, which supports the Bank of Canada's direction to continue lowering interest rates. 

Retail sales increased by 0.6% in July, marking the second monthly increase since the beginning of the current year.

This was in line with the average expectations of analysts surveyed by Bloomberg News.

 Sales had declined by 0.3% in June, and overall, retail sales in Canada decreased by 0.5% during the second quarter after a decline of 0.4% in the first quarter, recording the worst performance in two consecutive quarters since 2009.

Excluding the period of the COVID-19 pandemic in 2020 and 2021, this strengthens expectations for a third consecutive interest rate cut during the Monetary Policy Council meeting at the central bank on September 14.