JP: Retail Sales

Tue Sep 29 18:50:00 CDT 2015

Consensus Actual Previous
Year over Year 1.0% 0.8% 1.6%

August retail sales were up 0.8 percent on the year, lower than expectations of a 1.1 percent increase. This was the fifth consecutive increase. Among the subcategories, auto sales were up for a fifth month, this time increasing by 3.8 percent on the year after rising 3.7 percent last time. Fuel sales declined for an eleventh month. Fuel was 10.6 percent lower than a year ago after declining 9.0 percent in July. Retail machinery sales were up for a second month, this time by 4.8 percent on the year. Food & beverage sales were 3.5 percent higher than August 2014 while apparel sales added 4.5 percent.

August's sales increase was the slowest since March when they declined 9.7 percent (a dip explained by the extremely high growth figure for March 2014, when many Japanese 'front loaded' spending before a sales tax hike was implemented in April).

One bright spot was provided by larger retailers, however, whose sales rose 1.8 percent, but less than the 2.1 percent rise in July. This could be symptomatic of increased tourism to Japan on the back of a weaker yen, making the traditionally expensive country more affordable to visit.

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.