Flood-weary Albertans were probably restocking their shelves in July, giving a bump to store sales.
Economists expect Statistics Canada to report Tuesday that retail sales across the country rose by 0.5 per cent or better in July, after a slump of 0.6 per cent in June, when floods ravaged Alberta.
"With flat gasoline prices, gains should have been registered in other categories including food – where purchases likely rose as Alberta consumers stocked up on necessities after floods in June," said Emanuella Enenajor of CIBC World Markets.
"And while rainy weather in Central Canada may have kept some would-be shoppers indoors, categories such as building material/gardening sales may have bounced back on the end of the Quebec construction strike and Alberta flooding disruptions."
There are other factors as well, prompting BMO Nesbitt Burns to expect to see a jump of 0.9 per cent.
"Part of the weakness in June was due to the Alberta flood, which should be reversed," said BMO senior economist Benjamin Reitzes. "However, there was also a troubling drop in retail sales in central Canada, but given the rebound in manufacturing and wholesale activity, look for retail to follow suit."
Ms. Enenajor believes the July showing will bode well for the monthly reading of gross domestic product, but questions whether shoppers can keep it up.
"While that will be a boost for the month's GDP, it's not clear that consumers can keep the momentum going with rising interest rates, slowing consumer credit growth and softer trends in hiring," she said.
In the United States, markets will be watching on Wednesday for fresh numbers on purchases of big-ticket items and sales of new homes, and on Friday for personal spending and income data.