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The back-to-school shopping rush did little to get Canadians spending more money as consumer spending declined in August, cardholder data from the Royal Bank of Canada shows.
While core retail sales – a measure that does not include spending on vehicles and gas – rose 0.4 per cent in August, total spending declined 2.2 per cent, the RBC report said on Tuesday.
Core retail sales were weaker compared with July, when they rose by 1.1 per cent.
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“Most major spending categories saw growth—but slower—apart from clothing purchases, which accelerated. Travel spending dipped 0.1% seasonally adjusted on a three-month average,” the report said.
“The ongoing contraction in gasoline spending—continuing on a three-month average basis since the elimination of the consumer carbon tax this spring—has been a significant driver of this trend,” RBC economist Rachel Battaglia said in the report.
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Canadians are also spending less money using their credit cards, another report showed.
Monthly credit card expenses in Canada have dropped 17 per cent to $1,336 over the last two years, a report by data analytics firm J.D. Power and Associates shows.
The drop in spending is not limited to credit card use.
Cardholders report that their debit and cash spending have also declined since 2023, the report said.
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