UPDATE 2-Canadian retail sales disappoint in August

Tue Oct 23, 2012 11:19am EDT
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* Retail sales up 0.3 percent on month in August

* August increase mostly fueled by gas prices

* Markets had expected a 0.4 percent rise

* In volume terms, sales slid 0.3 percent

By Claire Sibonney

TORONTO, Oct 23 (Reuters) - Canadian retail sales rose less than expected in August from July while volume fell, suggesting debt-laden consumers will provide only limited support to broader economic growth in the third quarter.

Retail sales rose 0.3 percent in August to a record C$39.07 billion ($39.33 billion), pushed up largely by higher gasoline prices, Statistics Canada said on Tuesday.

The increase was slightly less than the 0.4 percent advance predicted by analysts. Retail sales in volume terms slid 0.3 percent.

"Canadian consumer spending remained choppy through the first two months of Q3, but growth should still pick up from a very sluggish Q2 performance," Robert Kavcic, an economist at BMO Capital Markets, said in a note to clients.   Continued...