Japanese Household Spending Falls for Seventh Month

Japan's household spending fell for the seventh consecutive month in June, casting doubt on the strength of domestic demand and weakening the case for a September Bank of Japan interest rate hike.

The data showed real household spending dropped 3.3% year-on-year, far exceeding the median market forecast for a 1% rise.

On a seasonally adjusted basis, spending fell 6.4% month-on-month, exceeding an estimated decline of 3.1%.

This divergence between rising real wages and falling actual spending points to a Japanese consumer who remains cautious despite improving purchasing power.