JP: Household Spending

Wed Apr 27 18:50:00 CDT 2016

Consensus Actual Previous
Year over Year -4.2% -5.3% 1.2%

The average of monthly consumption expenditures per household for March was down 5.3 percent from the previous year. Spending has now declined 12 of the last 15 months. Expenditures for food, fuel, light & water charges, medical care, transportation & communication, education, culture & recreation and other all declined. Only housing, furniture & household utensils and clothing & footwear managed to offset the losses. Combined with retail sales which were also released at the same time, the consumer sector continues to look bleak.

Household spending is an important gauge of personal consumption, which accounts for roughly 55 percent of Japan's gross domestic product.

The report looks at spending of households and gives a picture of consumer spending. Increases in household spending are favorable for the Japanese economy because high consumer spending generally leads to higher levels of economic growth. Higher spending is also a sign of consumer optimism, as households confident in their future outlook will spend more. The preferred number is the change from the previous year. The data are part of the family income and expenditure survey which is released at the same time as the employment and unemployment data.