Japan household spending slides for the eight straight month in October

Household spending in Japan slid for the eight straight month during October, following poor weather amid weak consumer demand in the already-ailing economy. Also, poor wages restricted individuals to shop, given that Japan’s demographic structure is skewed towards savings, rather than spending.

Japan’s household spending fell 0.4 percent from a year earlier (forecast -1 percent), following a 2.1 percent decline in September, data released by the Ministry of Internal Affairs and Communications showed Tuesday. That exceeded expectations for a decline of 1.0 percent following the 2.1 percent fall in September.

Further, on a monthly basis, household spending slid 1.0 percent. The average of monthly income per household stood at 485,827 yen, down 0.1 percent on the year. The average of consumption expenditures per household was 305,683 yen, down an annual 1.5 percent, data showed.

Although employment conditions continue to improve in the recent months, companies remain reluctant to raise salaries which increase their personnel costs because Japan’s potential growth rates look dimmer and profit prospects don’t look bright, Bloomberg reported.

Meanwhile, the USD/JPY has formed a small bullish candle at steady 111.94, while at 6:00GMT, the FxWirePro's Hourly Yen Strength Index remained neutral at 16.38 (below the +75 benchmark for bullish trend). For more details, visit http://www.fxwirepro.com/currencyindex