| Consensus | Consensus Range | Actual | Previous | Revised | |
|---|---|---|---|---|---|
| Month over Month | 0.1% | -0.8% to 0.7% | 1.0% | -1.6% | -1.7% |
| Year over Year | 4.9% | 3.4% to 5.1% | 5.3% | 4.2% | 4.1% |
Highlights
Japanese retail sales continued to post a solid gain on the year in November, up 5.3 percent, backed by solid demand for vehicles and appliances, with the pace of increase picking up again after slowing to 4.1 percent in October from 6.2 percent in September, data released Thursday by the Ministry of Economy, Trade and Industry showed.
On the month, retail sales rebound 1.0 percent after slumping 1.7 percent for the first drop in four months. The protracted heat wave that had dampened demand for autumn goods in the previous two months gave way to lower temperatures in the second half of November, boosting sales of winter clothing.
Sales values remained supported by elevated prices for food and beverages while fuel costs have stabilized. The number of visitors from other countries continued to show a sharp increase since Japan's Covid border control was widely eased in May and the yen remains weak, shoring up department store sales.
Econoday's Relative Performance Index (RPI) stood at plus 41, above zero, which indicates the Japanese economy is performing better than expected after underperforming with a narrower margin earlier. Excluding the impact of inflation, the RPI was at plus 48.
Japanese policymakers believe the economy still needs continued monetary and fiscal policy support to achieve sustainable wage growth and stable 2 percent inflation. The economy posted its first contraction in three quarters in July-September, pushing the output gap back into negative territory.
Retail sales rose a preliminary 5.3 percent on the year in November for the 21st straight year-over-year rise after rising 4.1 percent (revied down from 4.2 percent) in October, 6.2 percent in September and 7.0 percent (revised from 7.1 percent) in August. The increase was higher than the median economist forecast of a 4.9 percent rise (forecasts ranged from 3.4 percent to 5.1 percent gains). The 7.3 percent rise in February remains the highest since the 8.3 percent increase in May 2021.
On the month, retail sales rose 1.0 percent on a seasonally adjusted basis in November, following a 1.7 percent dip (revised down from a 1.6 percent fall) in October, a 0.4 percent rise in September, a 0.2 percent rise in August, a 2.2 percent jump in July. It was higher than the median forecast of a 0.1 percent increase (forecasts ranged from a 0.8 percent drop to a 0.7 percent rise).
The ministry maintained its assessment, saying retail sales are"on an uptrend." The three-month moving average in seasonally adjusted retail sales dipped 0.1 percent in November for a second straight drop after falling 0.4 percent the previous month.
Sales of automobiles rose 11.3 percent on year in November for the 15th straight gain after rising 9.9 percent in October. Improved supply chains and easing chip shortages have been supporting auto production and shipments. Sales of machinery and equipment (largely consumer electronics) also jumped 11.0 percent in November for the fifth increase in a row after rising 1.5 percent previously.
Sales of food and beverages, a category which has the largest share in retail sales, posted their 14th straight rise, up 5.8 percent, after rising 6.4 percent the previous month. Sales prices have been marked up to reflect high import costs seen earlier but the pace of goods price increases appears to have peaked.
General merchandise sales at department stores and supermarkets marked the 26th straight year-over-year gain, up 4.8 percent in November, after rising 3.5 percent in October. Sales of apparel and accessories rebound a slight 0.6 percent for the first rise in three months after falling 8.9 percent the previous month.
Sales of fuels rose 2.9 percent on the year in November after falling 1.2 percent in October for the first drop in four months and rising 7.1 percent in September. The government has been trying to cap retail gasoline price markups by providing subsidies to refineries. The process of phasing out the subsidy program began in June and was scheduled to end in September but officials have extended the program through yearned, and then until next April, as retail gasoline prices hit record highs from late August through early September.
Demand for medicine and cosmetics remained solid, up 3.9 percent in November, after a 4.8 percent gain in October.
On the month, retail sales rebound 1.0 percent after slumping 1.7 percent for the first drop in four months. The protracted heat wave that had dampened demand for autumn goods in the previous two months gave way to lower temperatures in the second half of November, boosting sales of winter clothing.
Sales values remained supported by elevated prices for food and beverages while fuel costs have stabilized. The number of visitors from other countries continued to show a sharp increase since Japan's Covid border control was widely eased in May and the yen remains weak, shoring up department store sales.
Econoday's Relative Performance Index (RPI) stood at plus 41, above zero, which indicates the Japanese economy is performing better than expected after underperforming with a narrower margin earlier. Excluding the impact of inflation, the RPI was at plus 48.
Japanese policymakers believe the economy still needs continued monetary and fiscal policy support to achieve sustainable wage growth and stable 2 percent inflation. The economy posted its first contraction in three quarters in July-September, pushing the output gap back into negative territory.
Retail sales rose a preliminary 5.3 percent on the year in November for the 21st straight year-over-year rise after rising 4.1 percent (revied down from 4.2 percent) in October, 6.2 percent in September and 7.0 percent (revised from 7.1 percent) in August. The increase was higher than the median economist forecast of a 4.9 percent rise (forecasts ranged from 3.4 percent to 5.1 percent gains). The 7.3 percent rise in February remains the highest since the 8.3 percent increase in May 2021.
On the month, retail sales rose 1.0 percent on a seasonally adjusted basis in November, following a 1.7 percent dip (revised down from a 1.6 percent fall) in October, a 0.4 percent rise in September, a 0.2 percent rise in August, a 2.2 percent jump in July. It was higher than the median forecast of a 0.1 percent increase (forecasts ranged from a 0.8 percent drop to a 0.7 percent rise).
The ministry maintained its assessment, saying retail sales are"on an uptrend." The three-month moving average in seasonally adjusted retail sales dipped 0.1 percent in November for a second straight drop after falling 0.4 percent the previous month.
Sales of automobiles rose 11.3 percent on year in November for the 15th straight gain after rising 9.9 percent in October. Improved supply chains and easing chip shortages have been supporting auto production and shipments. Sales of machinery and equipment (largely consumer electronics) also jumped 11.0 percent in November for the fifth increase in a row after rising 1.5 percent previously.
Sales of food and beverages, a category which has the largest share in retail sales, posted their 14th straight rise, up 5.8 percent, after rising 6.4 percent the previous month. Sales prices have been marked up to reflect high import costs seen earlier but the pace of goods price increases appears to have peaked.
General merchandise sales at department stores and supermarkets marked the 26th straight year-over-year gain, up 4.8 percent in November, after rising 3.5 percent in October. Sales of apparel and accessories rebound a slight 0.6 percent for the first rise in three months after falling 8.9 percent the previous month.
Sales of fuels rose 2.9 percent on the year in November after falling 1.2 percent in October for the first drop in four months and rising 7.1 percent in September. The government has been trying to cap retail gasoline price markups by providing subsidies to refineries. The process of phasing out the subsidy program began in June and was scheduled to end in September but officials have extended the program through yearned, and then until next April, as retail gasoline prices hit record highs from late August through early September.
Demand for medicine and cosmetics remained solid, up 3.9 percent in November, after a 4.8 percent gain in October.
Market Consensus Before Announcement
Japanese retail sales are forecast to have risen 4.9 percent on year in November, following increases of a revised 4.1 percent in October, 6.3 percent in September and 7.1 percent in August. New vehicle sales slowed while fuel prices rose at a slower pace. Retail sales are seen nearly flat on the month, up just 0.1 percent, after falling 1.7 percent in October, when the lingering heat wave dampened demand for autumn goods. Overall retail sales values have been supported by elevated prices for food and beverages. The number of visitors from other countries continued to show a sharp increase since Japan's Covid border control was widely eased in May and the yen remains relatively weak, propping up department store sales.
Definition
Retail Sales measure the total receipts at stores that sell durable and nondurable goods. The data are part of the Preliminary Report on the Current Survey of Commerce.
Description
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.
