|Year over Year||-6.8%||-9.7%||-1.8%|
Retail sales plummeted a greater than expected 9.7 percent from a year ago. This was the third consecutive month sales declined. March's result marks a fresh historic low in the data. The data do not bode well for first quarter consumer spending, a major portion of GDP. For the fiscal year, sales retreated 1.2 percent after rising 2.9 percent in fiscal year 2013.
All the subcategories were lower on the year. Auto sales dropped for a sixth consecutive month, this time by 4.1 percent on the year after sliding 2.6 percent the month before. Fuel sales sank 20 percent after 17.9 percent, no doubt partially attributable to the decline in crude oil. Retail machinery sales dropped for a twelfth month, this time by 27.9 percent after sliding 9.6 percent the month before. Apparel sales were down 6.2 percent after increasing 2.0 percent in February.
Japanese consumers have cut back spending since April 2014 when the country's sales tax was raised from 5 to 8 percent.
Retail sales measure the total receipts at stores that sell durable and nondurable goods.
Another way to look at consumer spending in addition to the household spending survey is through the retail sales report. This report gives the total value of goods and services sold each month at retail outlets. The preferred number is the change from the previous year. The report serves as a direct gauge of consumption and consumer confidence. Consumer spending is one of the most important leading indicators for the Japanese economy. Increasing sales signal consumer confidence and economic growth, but higher consumption also leads to inflationary pressures.
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