Canada retail sales proved more resilient than expected in November, as they edged down 0.1 percent from November, less than the 0.5 percent contraction expected in an Econoday survey that matched the agency's flash estimate. Sales grew 5.2 percent year-over-year.

Beyond the better-than-expected headline figure, the underlying picture was not encouraging, with core sales, excluding gasoline stations and motor vehicles and parts, falling 1.1 percent on the month, the largest drop in 11 months. In addition, sales volumes were down 0.4 percent.

Statistics Canada's flash estimate for December is for a 0.5 percent recovery.

Motor vehicle and parts increased 1.4 percent, and gas station receipts rose 2.2 percent in November, with volumes up 3.7 percent. Those gains partly offset declines in 6 of 11 subsectors led by food and beverages and building material and garden equipment and supplies. Furnishing and home furnishing sales, also related to the housing sector where conditions have been deteriorating, were down as well.

Regionally, sales decreased in eight provinces, led by Quebec.

The ECDI is currently at 4, indicating the Canadian economy is coming in closely in line with expectations.

The fourth quarter Bank of Canada's Canadian Survey of Consumer Expectations released Monday found that most consumers anticipate a mild recession over the next 12 months. Among these consumers, a majority expects to experience difficulty paying bills as a result. Against the background of high inflation and rising interest rates, Canadians also increasingly plan to cut back or postpone purchases over the coming months as access to credit worsens. On a more positive side, less than a sixth of respondents expect to lose their job in case of a recession.

Today's data reinforce the Bank of Canada's expectation of a weakening contribution of consumer spending in the fourth quarter, which, combined with a below-projected inflation rate, calls for a softening in the tightening pace.

Retail sales in November are expected to fall 0.5 percent following a 1.4 percent rebound in October.

Retail sales measure the total receipts at stores that sell durable and nondurable goods. The headline data are reported in cash terms and disaggregated into eleven main subsectors. Aggregate volume figures are also provided.

With consumer spending a large part of the economy, market players continually monitor spending patterns. Data are available both for total retail sales and those excluding autos and for 16 different store specializations. Since autos account for over 25 percent of retail sales, the sector can have a pronounced impact on overall sales given their volatility. Retail sales are used to estimate the goods portion of personal consumer expenditures in the quarterly GDP accounts, accounting for about 50 percent of the total.

The pattern in consumer spending is often the foremost influence on stock and bond markets. For stocks, strong economic growth translates to healthy corporate profits and higher stock prices. For bonds, the focus is whether economic growth goes overboard and leads to inflation. Ideally, the economy walks that fine line between strong growth and excessive (inflationary) growth.

Retail sales not only give you a sense of the big picture, but also the trends among different types of retailers. Perhaps apparel sales are showing exceptional weakness but electronics sales are soaring. These trends from the retail sales data can help you spot specific investment opportunities, without having to wait for a company's quarterly or annual report.