Statistics Canada said Thursday that sales at food and beverage stores were down 3.4% as sales at supermarkets and other grocery stores fell 3.4% and beer, wine and liquor stores lost 2.7%. Sales at convenience stores fell 8.4%, and specialty food stores dropped 0.4%.
BMO economist Shelly Kaushik said as the economy reopened shoppers diverted some of their spending from goods to services.
Sales at building material and garden equipment and supplies dealers were down 7.3% for the month, but remained elevated compared with pre-pandemic levels.
Motor vehicle and parts dealers reported sales gained 0.4% in July, led by a 0.8% increase at new car dealers.
Sales at gasoline stations rose 1.4%.
Statistics Canada said core retail sales—which exclude gasoline stations and motor vehicle and parts dealers—fell 1.3% for the month.
Retail sales in volume terms fell 1.1% in July.
Statistics Canada said its initial estimate for August suggested retail sales gained 2.1% for that month, but cautioned the figure would be revised.