By Satoshi Sugiyama
TOKYO (Reuters) – Japanese household spending fell in September for the second month in a row, government data showed on Friday, as higher prices dampened consumer appetite in a disappointing sign for the central bank's plans to raise interest rates further.
Consumer spending fell 1.1% from a year earlier, contrary to the market median estimate of a 2.1% decline. On a seasonally adjusted, month-on-month basis, it fell 1.3%, versus estimates of a 0.7% decline.
and wage trends are one of the main factors watched by the Bank of Japan (BOJ) to gauge the strength of the Japanese economy and decide how quickly to raise interest rates.
September payments data released on Thursday showed inflation-adjusted wages fell for the second month in a row despite nominal wages rising and consumer inflation declining.
A weakening yen that returns with the election of Donald Trump as the next US president could also pressure consumption through higher import prices, although the BOJ could in turn be pressured to raise interest rates if the yen's decline accelerates.
Japan will release preliminary gross domestic product (GDP) data for July-September next Friday. The economy is likely to slow sharply due to sluggish consumption and capital spending, according to a Reuters poll.
To view data on the Ministry of Home Affairs and Communications website, click here: http://www.stat.go.jp/english/data/kakei/index.html