The Canadian dollar rose for the second straight session following better than expected retail sales for the world’s ninth largest economy.  Heading into the close, the Canadian dollar is trading at 1.0261 against the US dollar, up from a low of 1.0305 hit earlier in the session.

According to Statistics Canada, retail sales in Canada jumped on the month, advancing by 1% in the month of October to C$38.6 billion.  The figure rises above the market estimate of a 0.4% climb – and repeats a 1% increase in the month of September.

The report was widely positive as it counters previous expectations that retail consumption in the Canadian economy would slow towards year end – on concerns the global slowdown would negatively affect the economy.  However, report findings bucked the sentiment as 7 of the total 11 subsector readings soared for the month – leading to the positive gain.  Notably, massive advances were seen in car part and vehicle purchases.  Although gasoline station sales jumped by a solid 1.8%, many are attributing the increase to a rise in the price of gasoline – rather than a pickup in volume consumption.

Nonetheless, the overall index reading is promising for a country that has faced its own round of downward revisions.  Last month the Bank of Canada – as well as other market analysts – revised growth estimates lower for the current and next year expectations.  For the year, the Canadian economy is expected to only expand by a 2.5-2.7% pace this year – compared to earlier forecasts of 3.5-4%.