By Daniel Leussink

TOKYO (Reuters) – Japan’s family spending rose for a second consecutive month year-on-year in February, helped by a flattering comparability with final yr’s sharp pandemic-induced droop however the shopper sector is now going through rising headwinds from hovering costs.

Households reduce spending from the earlier month as extra fast meals and gasoline value rises and the Omicron variant stored wallets shut, casting a shadow over the world’s third-largest financial system.

In an indication of bother for shopper sentiment, actual wage progress stagnated in February as world inflationary pressures which have been worsened by the Russia-Ukraine battle weighed on households’ buying energy.

Family spending elevated 1.1% in February from a yr earlier, authorities information confirmed, a lot weaker than the market forecast of a 2.7% acquire in a Reuters ballot.

The month-on-month figures confirmed a pointy 2.8% decline, additionally weaker than a forecast 1.5% drop.

The info raises some issues for policymakers in search of methods to offset the hit households are taking from hovering world inflation and a weakening yen, which is pushing up import prices, because the financial system shakes off the pandemic’s drag.

Authorities information on Tuesday additionally confirmed inflation-adjusted actual wages hit a standstill in February, as progress of shopper costs offset features in nominal wage progress, including to indicators that prospects for households aren’t brightening.

The financial system is predicted to develop within the present quarter following a projected contraction within the first three months of the yr, although it’s going through an unpredictable outlook partly as a result of Ukraine state of affairs and the weak yen.