Canadian retail sales were up 1.6% to $57.6 billion in October as new car sales rebounded after two consecutive months of declines.

Statistics Canada said Friday the effect of the semiconductor chip shortage on the supply of motor vehicles was less pronounced in October than in previous months.

Sales at motor vehicle and parts dealers were up 2.2%, led by a 2.8% jump in new car sales, the agency said.

Statistics Canada also said its preliminary estimate for November pointed to an increase in retail sales of 1.2% for the month, but it cautioned the figure would be revised.

“Canadian trade was moving into the fast lane in October and November, before omicron likely applied the brakes in December,” Andrew Grantham, a senior economist with CIBC Capital Markets, said in a client note.

The 1.6% increase in retail sales in October beat estimates of 1%, he noted, adding that Statistics Canada’s early estimate for November suggests retail and wholesale sales saw further impressive gains last month.

“Were it not for the rise of omicron and retightening of some restrictions across the country, we would probably be having to upgrade our Q4 GDP forecast even further,” Grantham said in the CIBC Economic Flash. “As it is, something around 4.5% may still be appropriate factoring in a modest December pullback.”

Meanwhile, overall core retail sales — which exclude gasoline stations and motor vehicle and parts dealers — increased 1.5%, the agency said.

Sales climbed in seven of 11 subsectors in October, representing nearly 60% of retail trade.

One of the biggest increases was at sporting goods, hobby, book and music stores, which saw sales soar 17.5%.

Statistics Canada noted that the uptick in sales coincided with the continued resumption of many recreational and school-based sporting leagues in the fall.

Sales at general merchandise stores rose 2.8% for a fifth consecutive month.

Building material and garden equipment and supplies dealers recorded a 3.2% increase in sales.

Meanwhile, sales at food and beverage stores edged down 0.6%, primarily due to weaker sales at supermarkets and other grocery stores.

Across Canada, retail sales were up in nine provinces in October, led by Ontario and Alberta. Quebec posted the lone provincial decline, with sales down 0.2% in October.

In volume terms, retail sales were up 0.9% in October.