By Paul Vieira

OTTAWA--Canadian wholesale transactions rose for a fourth consecutive month in August although at a markedly slower pace than previous months, the latest sign the recovery has moved into a lower gear.

Wholesale sales increased 0.3% on a seasonally adjusted basis in August from the previous month to 65.69 billion Canadian dollars (US$49.80 billion), Statistics Canada said Monday. Market expectations were for a 0.1% rise, according to economists at Bank of Nova Scotia.

In volume, or price-adjusted terms, sales climbed 0.1% in August.

August's performance was driven by activity in the building materials and motor vehicle sectors. That offset the losses in personal goods, and the food and beverage sectors.

August's gain marks a sharp deceleration. Wholesale transactions climbed by a revised 5.2% in July and 18.5% in June.

On a 12-month basis, wholesale trade in Canada rose 3.4% in August.

With August's gain, wholesale trade now sits 1.7% above pre-pandemic levels. Recent data, such as a decline in manufacturing in August, point to a slowdown in the Canadian recovery following a virus-induced sharp decline. Economists expect third-quarter gross domestic product to expand by more than 40%, on strong results in July, while projecting a slowdown in the final three months of the year.

Exacerbating matters is a rapid accumulation beginning in September of confirmed Covid-19 cases in Canada's most populous regions, prompting authorities to impose a fresh set of economic restrictions that are expected to weigh on growth.

Wholesale trade is the largest component of Canada's services sector. Wholesalers connect farmers or manufacturers that produce goods with companies and public institutions that use them. They also import goods from other countries and redistribute them within Canada.

Write to Paul Vieira at paul.vieira@wsj.com

(END) Dow Jones Newswires

10-19-20 0907ET