–METI Repeats Retail Sales Picking Up Gradually
–Department Store Sales Continue Recovering on Eased Covid Rules
–Sales of Cars, Appliances Remain Weak; Demand for Cosmetics, Drugs Strong
By Max Sato
(MaceNews) – Japanese retail sales posted their sixth year-on-year rise in August, led by high fuel prices and solid demand for summer clothing, cosmetics and drugs, data released Friday by the Ministry of Economy, Trade and Industry showed.
Industry data released last week showed department store sales marked the sixth straight year-over-year rise in August in reaction to a slump in August 2021, when the government imposed strict public health rules amid a surge in Covid cases.
The key points from the METI’s Current Survey of Commerce:
* Retail sales jumped a preliminary 4.1% on the year in August after rising 2.4% in July, 1.5% in June and 3.7% in May. The increase was higher than the median economist forecast of a 2.8% rise. Sales fell 0.9% in February, when the Omicron variant caused a spike in Covid cases. The government eased public health restrictions in late March and has continued reopening the economy despite record numbers of Covid infections from late July through late August.
* Sales of automobiles marked the 12th straight year-on-year drop, down 6.3% in August, after falling 2.3% in July, 8.1% in May and 11.1% in April.
* General merchandise (department store, supermarket) sales marked the sixth straight year-on-year gain, up a sharp 10.1% in August, after rising 4.6% in July, 4.5% in June and surging 20.7% in May, while sales of apparel and accessories gained 6.2% after rebounding 1.2% in July and falling 1.5% in June.
* Sales of fuels remained elevated, up 10.8% in August, after rising 7.9% in July. The pace of increase was higher at 11.8% in June, 15.2% in May and 13.8% in April. The government has been trying to cap retail gasoline price markups by providing subsidies to refineries.
* Demand for medicine and cosmetics remained strong, up 13.6% on the year in August, marking the 16th straight increase, after rising 8.5% in July and 4.6% in June. Sales of machinery and equipment (largely consumer electronics) fell 6.5% in August and 5.5% in July after edging up 0.4% in June and marking the first year-on-year gain in six months in April, up 0.8%. Global supply constraints have caused shortages of home appliances.
* On the month, retail sales rose 1.4% on a seasonally adjusted basis in August for the second straight rise after a 0.7% gain in July, a 1.3% drop in June and increases of 0.7% in May and 1.0% in April.
* The ministry maintained its view, saying retail sales are “picking up gradually.” In June, it upgraded its assessment for the second straight month.
* Industry data released last week showed department store sales marked the sixth straight year-on-year rise in August, up 26.1%, after rising 9.6% in July and 11.7% in June and surging 57.8% in May. The Japan Department Stores Association reported that special events and rush purchases before planned markups for some brand name goods supported overall sales, offsetting the dampening effect of a surge in Covid cases.
* Easing border restrictions continued supporting purchases by foreign visitors, up 176.0% on the year, but they remained well below pre-pandemic levels, down 64.0% from August 2019, the association said.