Japanese retail sales were unchanged last month from November, suggesting that consumer spending isn't contributing to a recovery in the world's second-largest economy.
Sales for all of last year at Japanese supermarkets, department stores, restaurants and other retailers fell 1.8 percent to ?128.4 trillion (US$1.21 trillion), the seventh year of decline, the Ministry of Economy, Trade and Industry said in Tokyo.
Japanese consumers are spending less because of declining wages and near-record unemployment, leaving the nation's economic recovery dependent on exports and corporate spending. Many retailers including Mitsukoshi Ltd, Japan's third-largest department store, aren't forecasting higher spending this year.
"We expect the situation will continue through this year," Mitsukoshi president Taneo Nakamura told a press conference in Tokyo yesterday. "Though some say the Japanese economy is improving, the retail industry hasn't perceived such a pick-up in sentiment."
Consumer spending has been the missing element in Japan's recovery from its third recession since 1991. Exports and investment by companies including Sharp Corp and Canon Inc accounted for all of Japan's 1.4 percent annualized pace of growth in the third quarter.
"Corporate profits are rising, but those increases are supported by companies' efforts to cut costs and wages, which is negative for consumption," said Motomitsu Honma, an economist at Sumitomo Mitsui Asset Management Co, which manages US$98 billion in assets.
The Topix Retail Trade Index, which tracks shares of 116 retailers, fell 0.4 percent to 641.70 at the 11am break in Tokyo, led by Aeon Co and Ito-Yokado Co. The broader Topix index fell 0.5 percent to 1058.36.
Retail sales had been expected to fall 1 percent last month from November, according to the median forecast in a Bloomberg News survey of seven economists. From a year earlier, December retail sales fell 0.1 percent, compared with a median forecast of a 1.8 percent drop.
Sales have fallen at Seiyu Ltd, Japan's fourth-largest retailer, and other service companies, which make up three-fifths of the US$4 trillion economy. The government said last week that demand for services fell a more-than-expected 2.3 percent in November from October.
Spending by households headed by a salaried worker fell 0.2 percent in November, the fourth drop in five months, and unemployment was unchanged at 5.2 percent, near the record high of 5.5 percent. Seiyu said its sales fell 3 percent in November, led by clothing and food.
Daiei Inc, Japan's third-biggest retailer, said sales fell 7 percent last month. Aeon, Japan's second-biggest retailer by sales, said same-store sales dropped 2.1 percent, while No. 5 Uny Co had a 3.3 percent drop.
"Japan's consumer spending remains in a severe environment," Shoichi Ogasawara, managing director at the Japan Chain Store Association, said at a press conference Monday in Tokyo.
The declines in sales last month from a year earlier were led by clothing, fuel, general merchandise and machinery and equipment.
‘ABUSE OF POWER’: Lee Chun-yi allegedly used a Control Yuan vehicle to transport his dog to a pet grooming salon and take his wife to restaurants, media reports said Control Yuan Secretary-General Lee Chun-yi (李俊俋) resigned on Sunday night, admitting that he had misused a government vehicle, as reported by the media. Control Yuan Vice President Lee Hung-chun (李鴻鈞) yesterday apologized to the public over the issue. The watchdog body would follow up on similar accusations made by the Chinese Nationalist Party (KMT) and would investigate the alleged misuse of government vehicles by three other Control Yuan members: Su Li-chiung (蘇麗瓊), Lin Yu-jung (林郁容) and Wang Jung-chang (王榮璋), Lee Hung-chun said. Lee Chun-yi in a statement apologized for using a Control Yuan vehicle to transport his dog to a
BEIJING’S ‘PAWN’: ‘We, as Chinese, should never forget our roots, history, culture,’ Want Want Holdings general manager Tsai Wang-ting said at a summit in China The Mainland Affairs Council (MAC) yesterday condemned Want Want China Times Media Group (旺旺中時媒體集團) for making comments at the Cross-Strait Chinese Culture Summit that it said have damaged Taiwan’s sovereignty, adding that it would investigate if the group had colluded with China in the matter and contravened cross-strait regulations. The council issued a statement after Want Want Holdings (旺旺集團有限公司) general manager Tsai Wang-ting (蔡旺庭), the third son of the group’s founder, Tsai Eng-meng (蔡衍明), said at the summit last week that the group originated in “Chinese Taiwan,” and has developed and prospered in “the motherland.” “We, as Chinese, should never
INDO-PACIFIC REGION: Royal Navy ships exercise the right of freedom of navigation, including in the Taiwan Strait and South China Sea, the UK’s Tony Radakin told a summit Freedom of navigation in the Indo-Pacific region is as important as it is in the English Channel, British Chief of the Defence Staff Admiral Tony Radakin said at a summit in Singapore on Saturday. The remark came as the British Royal Navy’s flagship aircraft carrier, the HMS Prince of Wales, is on an eight-month deployment to the Indo-Pacific region as head of an international carrier strike group. “Upholding the UN Convention on the Law of the Sea, and with it, the principles of the freedom of navigation, in this part of the world matters to us just as it matters in the
‘A SURVIVAL QUESTION’: US officials have been urging the opposition KMT and TPP not to block defense spending, especially the special defense budget, an official said The US plans to ramp up weapons sales to Taiwan to a level exceeding US President Donald Trump’s first term as part of an effort to deter China as it intensifies military pressure on the nation, two US officials said on condition of anonymity. If US arms sales do accelerate, it could ease worries about the extent of Trump’s commitment to Taiwan. It would also add new friction to the tense US-China relationship. The officials said they expect US approvals for weapons sales to Taiwan over the next four years to surpass those in Trump’s first term, with one of them saying
RSS