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Japan March household spending posts first fall in 3 months -Breaking

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© Reuters. FILE PHOTO – A woman shopping in a mall selling clothes for women is seen wearing a mask to protect her face during the COVID-19 (coronavirus disease) epidemic that erupted in Tokyo on July 26, 2020. REUTERS/Issei Kato

By Kantaro Komiya

TOKYO (Reuters – Japan’s household expenditure fell for the first month in three. The drop was lower than the analysts expected as people remained cautious about the rising cost of living despite an increase in COVID-19 curbs.

According to government data, household spending fell 2.3% in March compared with a year ago, according to Tuesday’s report. This was slower than Reuters median market estimates of a 2.8% decline and follows 1.1% growth.

The March seasonally adjusted month-on–month spending growth was 4.1%, which is higher than the expected 2.6%.

Japan’s consumer inflation has reached a multiyear high, fuelled by war in Ukraine and the rapid fall of the yen to 20-year lows.

Japan’s real wages declined in March as the inflation rate outpaced stable nominal wage growth.

According to the latest Reuters poll economists anticipate that the world’s third largest economy will experience an annualized decline of 0.7% over the quarter January-March. Then, they expect a 5.1% increase in April and June.

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