By Max Sato
(MaceNews) – Japan’s retail sales posted the first year-over-year drop in six months in August as a resurgence in coronavirus cases and stormy weather from the middle of the month kept shoppers away, data from the Ministry of Economy, Trade and Industry released Thursday showed.
Retail sales slumped a preliminary 3.2% on the year in August after a 2.4% gain, coming in weaker than the median economist forecast for a 1.0% drop. The pace of growth hit a peak of 11.9% in April in reaction to weak consumer spending during the first wave of the pandemic.
Fuel sales continued to grow at a relatively high pace of 12.9% in August after surging 27.8% in July while sales of food and beverages fell 1.4%, the first drop in three months after a 2.4% increase. Apparel sales dipped 12.1% after rising 3.1% in July after plunging 11.9% in June. Machines and equipment (consumer electronics, etc.) slumped 13.0%, the third straight year-on-year drop following a 2.8% fall in July.
On the month, retail sales fell 4.1% on a seasonally adjusted basis in August for the first drop in three months after rising 1.0% in July. The three-month moving average was unchanged from the previous three-month period in August after rising 1.3% in July.
METI maintained its view that retail sales are “flat.”
Industry data released last week showed department store sales slumped 11.7% on year in August, the first drop in two months after a 4.2% gain in July. Rain storms caused damage in some regions and the government urged restrictions on traveling and business operations across the country. August sales were 32.1% below the pre-pandemic level seen in August 2019.
On the upside, wealthy consumers continued seeking high-end watches and other luxurious goods while demand for takeout food, sweets and alcohol beverages remained strong during the pandemic.