Japan household spending up 4.7% in May, fastest pace in nearly 3 yrs

A grocery store is seen in Tokyo in this June. 10, 2022 file photo. (Mainichi)

TOKYO (Kyodo) — Japan’s household spending rose a real 4.7 percent in May from a year earlier, marking the first rise in two months and the fastest increase since August 2022, boosted by strong auto purchases and travel demand, government data showed Friday.

Households of two or more people spent an average of 316,085 yen ($2,200) in the reporting month, the Ministry of Internal Affairs and Communications said.

By category, spending on transportation and communications led the overall increase, jumping 25.3 percent, after minivehicle sales slumped last year as Daihatsu Motor Co. halted production due to a safety test scandal, a ministry official said.

Outlays on recreation and leisure also surged 11.1 percent in May, marking the fourth straight month of increase, buoyed by strong demand for domestic and overseas travel tours.

Expenditures on furniture and home appliances climbed 9.3 percent, as expectations for a hot summer prompted consumers to buy air conditioners, the official said.

Spending on food, which made up nearly 30 percent of household expenditures, rose 1.0 percent, up for the second consecutive month, as people dined out and purchased more vegetables as prices stabilized.

The spending data is a key indicator of private consumption, which makes up more than half of Japan’s gross domestic product.

The average monthly income of salaried households with at least two individuals grew a real, or inflation-adjusted, 0.4 percent to 522,318 yen, rising for the first time in five months, the ministry said.