TOKYO (Reuters) – Japan’s household spending likely increased in October, bouncing back from declines caused by natural disasters, a Reuters poll showed on Friday, offering hope consumer spending is recovering from its third-quarter weakness.
Household spending was expected to rise 1.4 percent in October from a year earlier, the poll of 16 economists found, after falling 1.6 percent in September, when it was hit by typhoons and an earthquake.
“Consumption of services will recover as supply constraints from the natural disasters, such as traffic paralysis, were solved,” said Koya Miyamae, senior economist at SMBC Nikko Securities.
“Spending on durable goods such as autos also likely recovered,” he said.
Takeshi Minami, chief economist at Norinchukin Research Institute, noted that wages were improving and the trend of consumer spending was picking up.
The government will announce October household spending data at 8:30 a.m. on Friday, Dec. 7 Japan time (2330 GMT on Dec. 6).
Data on Thursday showed retail sales grew the fastest in 10 months in October as consumers shelled out more on fuel, cars, medicines and cosmetics, a sign the world’s third-largest economy is likely returning to growth after a summer stumble.
Analysts believe the economy is rebounding in October-December after shrinking in the third quarter but risks such as trade protectionism add to headaches for policymakers, already worried by the damage a planned sales tax hike next year will likely cause.
(Reporting by Kaori Kaneko; Editing by Richard Borsuk)