Stories
Japan Household Spending Falls for Ninth Month Despite Rising Wages
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CNBC TV18•09-10-2026, 07:06
Japan Household Spending Falls for Ninth Month Despite Rising Wages
- •Japan's household spending dropped 3.1% in August from a year earlier, marking the ninth consecutive month of decline.
- •Persistent inflation continues to erode consumers' purchasing power and weigh heavily on domestic demand.
- •Lower spending on education, entertainment, food, home maintenance, rent, and utilities pulled down the overall index.
- •The weak economic data complicates the Bank of Japan's policy outlook regarding further interest rate increases.
Key Questions Answered
Household spending fell 3.1% in August from a year earlier as persistent inflation continued to erode consumer purchasing power, despite rising wages and pensioners missing out on wage growth.
Lower spending on food, education, entertainment, home maintenance, rent, and utilities pulled down the overall index, with utility spending dropping by 5.2%.
Prime Minister Sanae Takaichi introduced measures and subsidies to curb the cost of living and planned to cut the sales tax on food from 8% to 1% starting in April, with a pledge to restore the original rate after two years.
