| Consensus | Consensus Range | Previous | |
| Month over Month | 2.3% | -0.9% to 3.9% | -2.5% |
| Year over Year | -0.8% | -2.9% to 0.5% | -1.0% |
Market Consensus Before Announcement
Japan’s real household spending is expected to fall year over year for a third consecutive month in February amid signs of a broad slowdown in department store and supermarket sales, as well as declines in new passenger car registrations. The trend is underscored by February retail sales data, which posted the first year-over-year decline in two months.
Consumers remain cautious as real wages continue to fall. Recent spending trends suggest households are simplifying ceremonies and cutting back on weddings and funerals, while prioritizing food and other daily necessities. There is also a widespread shift toward more affordable mobile communication plans.
Household spending in February is expected to fall 0.8 percent from a year earlier after a 1.0 percent decline in January. The January drop was driven by a 10th consecutive year-on-year decline in both gift-related spending and mobile communication charges, as well as volatility in private university tuition fees.
Still, household spending is expected to rise for the first time in three months, increasing 2.3 percent month-on-month in February after slipping 2.5 percent in January.
Definition
Household Spending is an important gauge of personal consumption, which accounts for roughly 55 percent of Japan's gross domestic product. It is part of the monthly Family Income and Spending Report.
Description
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.