Japan retail sales fall for third straight month

Japanese retail sales fell for a third straight month in February as households reined in spending amid the coronavirus emergency , government data showed on Tuesday, highlighting the fragility of the economy's recovery from last year's slump .

Analysts expect Japan's economy to contract sharply in the first quarter as sluggish consumer spending and weak exports challenge policymakers who have already deployed massive stimulus measures.

It is reported that Japan's retail sales in February fell 1.5% from the same period last year , less than the market's median expectation of a 2.8% drop.

But it was the third straight month of declines for the index, following falls of 2.4% in January and 0.2% in December.

" The coronavirus has not subsided, which is a major reason for concerns that economic recovery will be delayed, " said Atsushi Takeda, chief economist at Japan's Itochu Economic Research Institute.

He added: "Clothes are not selling because people are staying at home. People are not really returning to shopping malls . Their favorite thing is to go shopping at nearby supermarkets. "

The overall decline in retail sales was driven by lower spending on items such as clothing, toiletries and general merchandise, according to the data.

On a seasonally adjusted basis, retail sales increased 3.1% compared to the previous month. Separate data showed that the national seasonally adjusted unemployment rate remained stable at 2.9%, below the median forecast of 3.0%.

Japan's Labor Ministry data showed that the number of jobs per applicant was 1.09 in February, down from 1.10 in the previous month.

The world's third-largest economy , Japan, which is highly dependent on exports, is struggling even after a massive influx of U.S. stimulus money into imported goods. Japan's GDP contracted at an annualized rate of 28.8% in the second quarter of 2020, the largest drop on record. Even after rebounding by 21.4% in the third and 12.7% in the fourth quarter, Japan's national accounts are still lagging behind mid-2019 levels.

Japan, the world's third-largest economy, will shrink by 6.0% on an annualized basis in the current quarter, according to the latest Reuters poll data, which would be the first decline in three quarters due in part to a drop in consumer spending.

Some analysts worry that a prolonged contraction in household spending and weak exports will lead to a slower economic recovery than initially expected.

Japan

economy

Retail Sales