RTTNews - Canadian retail sales rose more than forecast in May, bolstered by stronger sales at automotive dealerships and hardware stores, according to data released Wednesday morning by Statistics Canada.

Retail sales in current dollars increased 1.2% in May to $34.0 billion, more than offsetting a modest decline in April. Economists were expecting sales to rise a more modest 0.5%.

Sales increased in seven of eight sectors, led by a 2.4% increase in the automotive sector. Retail sales have been generally rising since the beginning of 2009.

In volume terms, retail sales increased 0.7%.

A 3.4% rise in sales at new car dealers was the main contributor to May's increase in the automotive sector, reflecting increased sales of trucks, according to the New Motor Vehicle Sales Survey.

Used and recreational motor vehicle and parts dealers saw their sales rise 1.8% after six months of declines. Sales at gasoline stations advanced 0.9% after decreasing 4.7% over the previous two months.

Excluding autos, Canadian retail sales rose 0.7%.

The building and outdoor home supplies stores sector saw sales increase by 1.0%, double the rate of the previous month. Sales in home centers and hardware stores were up 1.1%, rising for the fourth consecutive month. Specialized building materials and garden stores posted a 0.8% gain after decreases in the previous two months.

After declining in April, sales at food and beverage stores rose 0.7%, with all store types registering increases. None of these increases offset April's declines.

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