| Consensus | Consensus Range | Actual | Previous | Revised | |
| Month over Month | -0.6% | -1.0% to -0.3% | -2.0% | 0.6% | 0.7% |
| Year over Year | 0.4% | -0.5% to 1.4% | -0.9% | 1.0% | 1.1% |
Highlights
Japanese retail sales unexpectedly fell on year in December, down 0.9% (consensus +0.4%), marketing their first drop in four months following a tepid 1.1% rise (revised from +1.0%) in November in the face of falling fuel costs and a slip in clothing sales. It was also due to slower department store sales as the spending sprees among visitors from overseas has waned and Chinese tourists bypassed Japan over strained diplomatic ties. Retail sales have picked up recently but the pace of year-on-year increase had slipped from above 3% seen in early parts of 2025.
The Ministry of Economy, Trade and Industry maintained its assessment after upgrading it last month for the first month in eight months, saying retail sales are taking one step forward, one step back.
Industry data released Friday showed that department store sales recorded their first year-on-year drop in December, down 1.1%, after rising a modest 0.9% in November. There were four Sundays last month, one fewer busy shopping day compared to a year earlier, but it was largely the result of the latest feud between Tokyo and Beijing over Prime Minister Sanae Takaichi's remarks that a military threat to Taiwan would heighten Japan's own security risks.
Department store sales to domestic customers rose 0.6% in December for the fifth straight increase while those to inbound shoppers plunged 17.1%. Duty-free sales slumped for the second straight month, hit by a 40% drop in the number of Chinese visitors and sales to them, although sales to visitors from Taiwan, Thailand and Malaysia posted gains.
Details:
Japan Dec retail sales -0.9% y/y (Nov revised up to +1.1% from +1.0%); 1st fall in 4 months; median forecast +0.4% (range: -0.5% to +1.4%)
Japan Dec retail sales -2.0% m/m (Nov revised up to +0.7% from +0.6%); 1st drop in 4 months; median forecast -0.6% (range: -1.0% to -0.3%)
Japan METI maintains view: retail sales taking one step forward and one step back
Japan Dec retail sales y/y fall led by clothing, fuel, department store
Market Consensus Before Announcement
Japan’s retail sales are expected to rise 0.4 percent on the year in December, extending gains for a fourth straight month, supported by robust automobile sales and a slowdown in the decline of new passenger car registrations.
Still, the year-on-year increase was weighed down by slower department store sales and falling gasoline prices in December. In November, retail sales rose 1.1 percent (revised from up 1.0 percent), lifted by strong demand for drugs and cosmetics, solid vehicle sales and a sharp gain in appliances, possibly reflecting increased purchases of heat pumps and other seasonal goods.
On a month-on-month basis, retail sales are expected to post their first decline in four months, falling 0.6 percent on a seasonally adjusted basis, after rising 0.7 percent (revised from up 0.6 percent) in November and gaining 1.6 percent in October.
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.