Japanese Households Increase Spending For First Time In 4 Months | Business and economy

Spending increased 3.5% in June due to the rebound in domestic travel.

Japanese households increased spending for the first time in four months in June as demand for travel services increased in a positive sign for broader economic recovery prospects.

Spending increased 3.5% in June from a year earlier, government data showed on Friday, recording its first year-over-year increase since January when families opened purse strings for overnight stays, package tours. and outdoor items.

The data, which was stronger than the median estimate of a 1.5% increase in a Reuters poll, showed that people spend less on fish and vegetables, while also spending more on transportation.

Although the increase was larger than expected, it was unlikely to completely dispel concerns that Japan’s recovery will remain slower than those seen in other leading economies such as the United States.

Separate data on Friday showed that Japan’s real wages extended the declines for a third straight month in June as consumer prices rose faster than nominal wages, a worrying signal for household purchasing power.

A private sector survey earlier this week showed activity growth in the services sector stalled in July as rising inflation and uncertainty over the global economy hurt demand. .

Some analysts have begun to warn that Japan’s economic recovery may slow in the current quarter following an expansion expected in April-June due to a modest rebound in consumer demand after the government lifted COVID limits. 19.

Data on Friday showed spending also increased from the previous month, gaining 1.5% on a seasonally adjusted basis.

That gain, which was stronger than an expected 0.2% increase, rebounded from a strong 1.9% drop in the previous month.