TOKYO (BLOOMBERG) - Japan's retail sales unexpectedly declined in December, indicating weakness in consumer spending a day before the central bank makes a decision on whether to boost monetary stimulus.
Sales fell 1.1 per cent from a year earlier, matching the November result, according to the data released by the trade ministry on Thursday (Jan 28). The median estimate of 20 economists surveyed by Bloomberg News was for a 0.2 per cent gain. From a month earlier, sales declined 0.2 per cent.
The weak reading adds to concerns about the weakness of price gains in Japan, with inflation data due on Friday forecast to show a increase of just 0.1 per cent. Turmoil in global financial markets and the yen's recent strength put pressure on the Bank of Japan to consider a policy adjustment to fuel prices and growth in Japan.
Mild weather in December hurt sales of winter clothes, fuel and other seasonal products, Azusa Kato, an economist at BNP Paribas in Tokyo, said before the release. There are prospects for an improvement in consumer spending when these seasonal factors pass, he said.