According to the data given to the Japanese government, retail sales rose to 1.1 per cent in March.
The rise may have been influenced by rising prices, rather than stronger consumer spending. “The rise is mainly due to increases in fuel and food sales as their prices rose. Thus, excluding those factors, retail sales and consumption are basically flat,” said Yasuo Yamamoto, senior economist, Mizuho Research Institute.
According to Azusa Kato, an economist at BNP Paribas, “It’s hard to expect a significant improvement in consumption. With corporate earnings deteriorating, it is difficult to think wages will rise in the near future.”
Retail sales picked up pace in February, rising 3.2 per cent from a year earlier, despite slow growth in wages.
On Friday, data showed Japanese annual inflation hit a decade-high 1.2 percent in March, as energy prices soared, but the central bank is expected to sit tight on interest rates in the face of a soft economic outlook at home and abroad.
Source: CNBC
