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"Wholesale trade won't be giving much support to the (gross domestic product) outlook".
- CIBC
Wholesale sales rose less than anticipated for the fourth consecutive time on Monday, with data failing to meet the 0.5% forecast. The reading stood at 0.1%, meaning a C$54.8 billion, as reported by Statistics Canada. Consequently, the weak reading means that barely any growth occurred in May, as the figures declined for two months in a row prior to that. Among the sales sectors rebounds were detected in raw materials, such as ores, minerals, wood logs, precious and industrial metals. These materials contributed to the wholesale sales the most since August 2011. Elsewhere, food and beverages showed signs of growth, providing a decent boost to the wholesales sales reading. However, these gains were offset by drops in the sales of machinery and equipment, construction, mining and other activities. Furthermore, supplies and building materials also contributed to the weaker-than-expected growth, with their sales down 2%, making it a decline for the fourth month in a row.
Nevertheless, the wholesale sales is the data required for the calculation of the upcoming Canadian GDP, which is due next week, while the retail sales data, also required, is coming up next this week. Despite a poor reading of the wholesale trade, the GDP is unlikely to post a slowdown.