Japan Household Spending

Household spending in Japan dropped in real terms by 0.5% yoy in February 2024, less than market forecasts of a 3.0% fall and much softer than a 6.3% decline in the prior month which was the steepest contraction in 23 months. The latest result pointed to the 12th straight month of drop in personal expenditure but the weakest pace in the sequence, with spending falling much slower for transport & communication (-1.1% vs -13.1%) and culture & recreation (-1.5% vs -9.0%). At the same time, expenditure rebounded for food (2.0% vs -2.7%) and housing (9.5% vs -19.8%) while picking up strongly for clothing & footwear (11.6% vs 1.8%). Further, spending accelerated for medical care (9.4% vs 8.2%), with education expenditure surging further (41.5% vs 29.6%). By contrast, spending decreased more for fuel, light & water charges (-18.6% vs -9.4%) and furniture & household utensils (-2.0% vs -1.8%).