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Japan September household spending falls for second straight month

BY Reuters | ECONOMIC | 11/07/24 06:49 PM EST

By Satoshi Sugiyama

TOKYO (Reuters) -Japanese household spending fell in September for the second straight month, government data showed on Friday, as higher prices choked consumers' appetite in a discouraging sign for the central bank's plans to hike rates further.

Consumer spending fell 1.1% from the year earlier, against the median market forecast for a 2.1% decline. On a seasonally adjusted, month-on-month basis, it fell 1.3%, versus an estimated 0.7% drop.

Consumption and wage trends are among key factors the Bank of Japan (BOJ) is watching to gauge the strength of Japan's economy and decide how soon to raise interest rates.

September's pay data released on Thursday showed inflation-adjusted wages falling for the second straight month despite nominal salary making gains and consumer inflation cooling.

The yen's renewed softening with the election of Donald Trump as the next U.S. president could also hit consumption through higher import prices, although the BOJ could in turn be pressured to raise rates if the yen's fall accelerates.

Japan will release preliminary July-September gross domestic product (GDP) data next Friday. The economy likely slowed sharply on sluggish consumption and capital spending, according to a Reuters poll.

To view the data on the website of the Ministry of Internal Affairs and Communications, click here: http://www.stat.go.jp/english/data/kakei/index.html

(Reporting by Satoshi SugiyamaEditing by Chang-Ran Kim)

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