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Retail sales paused for a breath in August, climbing just 0.1 per cent for the month, well below expectations.

Sales during the month totalled $23.4-billion, Statistics Canada said Monday. That falls short of the 0.8 per cent increase most economists had been forecasting.

Although consumer spending on motor and recreational vehicle sales continued at a strong pace, other sectors didn't fair so well in August.

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Statscan said, excluding gains from motor and recreational vehicles, total sales dropped by 0.5 per cent in August.

Lower sales, the government agency said, were reported by furniture, general merchandise, clothing and drug stores.

Monday's figures follow three months of solid gains reported by Canadian retailers.

Despite the the pause, Statscan said, the overall spending in retail stores was up 5.7 per cent from the same month a year earlier. As well, it said, retail sales in the first eight months of this year were 6.4 per cent higher than in the same period in 1999.

"I think it's just a pause after three very strong months," Adrienne Warren, senior economist at Bank of Nova Scotia, said.

She said consumers are likely becoming a bit more cautious, given the slowdown in job growth and renewed volatility in financial markets. But, at the same time, job markets remain healthy, unemployment rates are falling and interest rates are stable, suggesting consumer spending will likely remain healthy, she said.

"If you look at the volume increases for the third quarter, because of the big increases in July, we've already got close to an 8 per cent annualized increase for the third quarter versus about 2 per cent in the second quarter," Ms. Warren said.

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In August, retailers in the automotive sector posted their fourth consecutive monthly gain with sales climbing 0.8 per cent, Statscan said. Within the sector, sales by motor and recreational vehicle retailers rose 1.7 per cent, while automotive and service stores posted increases of 0.8 per cent.

Statscan said low financing rates and big cash rebates helped push vehicle sales higher during the month.

Meanwhile, food sales were up 0.3 per cent in August, while retailers in the the other category - including liquor, sporting goods, hardware and books - posted gains of 0.6 per cent.

Consumers cut the amount they spent at furniture stores, with sales dropping 2.7 per cent in August. General merchandise sales fell 1.7 per cent and sales at department stores were down 3.8 per cent, Statscan said.

"Despite this decline, department store sales have followed an upward movement that began early in the spring, after a period of declines that started in September 1999," Statscan said.

Spending at clothing retailers was down 0.9 per cent in August after three months of increases, Statscan said.

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New Brunswick, Newfoundland and British Columbia posted the strongest retail sales gains in August. Those reflected mostly higher sales in the automotive sector.

After strong June and July sales, retailers in Nova Scotia and Quebec posted the only significant declines in the country. Sales in Nova Scotia were down 1.8 per cent. Quebec's sales were off 0.6 per cent.

Retailers in the remaining provinces, Statscan said, saw little change in August.

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