OTTAWA - Retail sales fell 0.5 per cent to $61.1 billion in September led by a drop in sales at gas stations along with food and beverage stores, Statistics Canada said Tuesday.

However, the agency said its initial estimate for October pointed to a gain of 1.5 per cent for the month, though it cautioned the figure would be revised.

"Retail sales fell in September; though the drop was smaller in volume terms, real spending took a notable step back in the third quarter," BMO economist Shelly Kaushik wrote in a report.

"However, solid advance estimates for retail and manufacturing sales, as well as wholesale trade, point to a recovery in October."

For September, Statistics Canada said sales at gas stations fell 2.4 per cent as sales in volume terms at gas stations rose 4.2 per cent, but gas prices fell 7.4 per cent.

Meanwhile, sales at motor vehicle and parts dealers were relatively unchanged as sales at used car dealers slipped 3.5 per cent, offset by a 2.3 per cent gain at other motor vehicle dealers and automotive parts, accessories and tire stores rose 0.4 per cent.

Sales at food and beverage stores dropped 1.3 per cent in September, as supermarkets and grocery store sales fell 1.6 per cent and convenience stores lost 1.5 per cent.

Building material and garden equipment and supplies dealers saw sales fall 2.0 per cent.

Core retail sales — which exclude sales at gasoline stations and motor vehicle and parts dealers — fell 0.4 per cent in September.

In volume terms, retail sales fell 0.1 per cent in September.

Retail sales for the third quarter as a whole were down 1.0 per cent, the first quarterly decline since they fell 11.9 per cent in the second quarter of 2020 at the start of the pandemic.

Retail sales in volume terms were down 1.4 per cent in the third quarter of 2022.

This report by The Canadian Press was first published Nov. 22, 2022.

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