Spending in Japanese stores increases in October as economy reopens, outlook murky

0
16

TOKYO: Sales in Japanese supermarkets and department stores increased in October as the end of coronavirus restrictions led to increased consumption, industry data showed on Thursday, but the modest rebound suggested that ‘full recovery will take time.

Japanese department store sales rose 2.9% in October from a year earlier on strong demand for jewelry and women’s clothing, according to data from the Japan Department Stores Association.

Those of chain stores, which include supermarkets such as Aeon and furniture stores such as Nitori Holdings, rose 3.7% in October from a year earlier, according to data from the Japan Chain Stores Association.

See also  Economic recovery has strengthened, but its pace is uneven: RBI

While the data points to a pickup in spending, it casts doubt on how quickly the world’s third-largest economy can rebound from the pandemic slump in the fourth quarter, following the lifting of the state of emergency on September 30.

Analysts said a full-fledged recovery in sectors hit hard by the pandemic such as services will likely take time.

“Consumption is coming back, but not as a V-shaped recovery from the lows of the state of emergency,” said Yutaro Suzuki, an economist at the Daiwa Research Institute. “The pace of the recovery is gradual.”

See also  Fuel excise tax cuts will have a positive impact on inflation, says RBI governor

A separate survey by the Japan Foodservice Association showed sales at pubs, fast food outlets and family-owned restaurants fell 0.5% in October from a year ago.

It was much better than a sharp 8.2% year-on-year drop in September, data showed, suggesting conditions largely stabilized in October.

“The restrictions were lifted again in November, so (spending) should improve,” said Taro Saito, executive researcher at the NLI Research Institute.

See also  Vaccine mandates are pouring into job postings

Consumers were probably becoming less hesitant to go out after Japan saw a sharp drop in COVID-19 cases, Saito said.

The data comes as the Japanese government raised its consumer stance for the first time in 13 months earlier on higher spending on services.

(Reporting by Daniel Leussink and Kantaro Komiya; Editing by Ana Nicolaci da Costa)

LEAVE A REPLY

Please enter your comment!
Please enter your name here