Economy

Japan’s spending downturn, wages decline heighten pressure on economy

Published

1 year ago

May 8, 2023

TOKYO — Japan’s consumer spending unexpectedly fell in March at the fastest rate in a year, while real wages marked a twelfth month of decline on persistent inflation, highlighting the challenges facing the economy in mounting a strong post-COVID revival.

Tuesday’s government data also reinforce the uncertainties around the Bank of Japan’s policy outlook amid slowing global growth and financial sector worries even as expectations build for a phasing out of its ultra-easy monetary settings.

“Rising prices, while somewhat moderated by the government’s energy subsidy programs, have put downward pressure on consumption by shaving households’ real purchasing power,” said Masato Koike, economist at Sompo Institute Plus.

Household spending fell 1.9% in March from a year earlier, the data showed, against economists’ median forecast for a 0.4% rise and following a 1.6% gain in February.

It marked the biggest decline since March 2022’s 2.3%, when Japan was still trying to curb the spread of coronavirus.

On a seasonally adjusted, month-on-month basis, spending decreased 0.8%, versus an estimated 1.5% increase and posting a second month of decline after being down 2.4% in February.

For the full fiscal year 2022 that ended in March, household spending rose 0.7%, slowing from 1.6% expansion in fiscal 2021.

Separate data showed Japanese real wages falling 2.9% in March, marking the full year of declines that started in April 2022 on decades-high consumer inflation.

Despite the boon from eased COVID-19 restrictions on domestic shoppers and international travelers, accelerating prices have put a lid on Japan’s consumption-led recovery from the pandemic.

Moreover, while large firms concluded three-decade-high wage hikes at their March labor talks, whether the trend spreads to smaller businesses is key to the outlook for monetary policy normalization under the new BOJ Governor Kazuo Ueda.

Looking ahead, analysts say slowing price inflation will lead to a rebound in pay in real terms.

Japan’s economy likely expanded an annualized 1.4% in January-March and is set continue growing at the same pace in April-June, economists in the latest Reuters poll showed last month. (Reporting by Kantaro Komiya Editing by Shri Navaratnam)

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Economy

S&P/TSX composite gains almost 100 points, U.S. stock markets also higher

Published

14 hours ago

September 13, 2024

Anne Joseph

TORONTO – Strength in the base metal and technology sectors helped Canada’s main stock index gain almost 100 points on Friday, while U.S. stock markets also climbed higher.

The S&P/TSX composite index closed up 93.51 points at 23,568.65.

In New York, the Dow Jones industrial average was up 297.01 points at 41,393.78. The S&P 500 index was up 30.26 points at 5,626.02, while the Nasdaq composite was up 114.30 points at 17,683.98.

The Canadian dollar traded for 73.61 cents US compared with 73.58 cents US on Thursday.

The October crude oil contract was down 32 cents at US$68.65 per barrel and the October natural gas contract was down five cents at US$2.31 per mmBTU.

The December gold contract was up US$30.10 at US$2,610.70 an ounce and the December copper contract was up four cents US$4.24 a pound.

This report by The Canadian Press was first published Sept. 13, 2024.

Companies in this story: (TSX:GSPTSE, TSX:CADUSD)

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Economy

Statistics Canada reports wholesale sales higher in July

Published

21 hours ago

September 13, 2024

Anne Joseph

OTTAWA – Statistics Canada says wholesale sales, excluding petroleum, petroleum products, and other hydrocarbons and excluding oilseed and grain, rose 0.4 per cent to $82.7 billion in July.

The increase came as sales in the miscellaneous subsector gained three per cent to reach $10.5 billion in July, helped by strength in the agriculture supplies industry group, which rose 9.2 per cent.

The food, beverage and tobacco subsector added 1.7 per cent to total $15 billion in July.

The personal and household goods subsector fell 2.5 per cent to $12.1 billion.

In volume terms, overall wholesale sales rose 0.5 per cent in July.

Statistics Canada started including oilseed and grain as well as the petroleum and petroleum products subsector as part of wholesale trade last year, but is excluding the data from monthly analysis until there is enough historical data.

This report by The Canadian Press was first published Sept. 13, 2024.

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Economy

S&P/TSX composite up more than 150 points, U.S. stock markets mixed

Published

2 days ago

September 12, 2024

Anne Joseph

TORONTO – Canada’s main stock index was up more than 150 points in late-morning trading, helped by strength in the base metal and energy sectors, while U.S. stock markets were mixed.

The S&P/TSX composite index was up 172.18 points at 23,383.35.

In New York, the Dow Jones industrial average was down 34.99 points at 40,826.72. The S&P 500 index was up 10.56 points at 5,564.69, while the Nasdaq composite was up 74.84 points at 17,470.37.

The Canadian dollar traded for 73.55 cents US compared with 73.59 cents US on Wednesday.

The October crude oil contract was up $2.00 at US$69.31 per barrel and the October natural gas contract was up five cents at US$2.32 per mmBTU.

The December gold contract was up US$40.00 at US$2,582.40 an ounce and the December copper contract was up six cents at US$4.20 a pound.

This report by The Canadian Press was first published Sept. 12, 2024.

Companies in this story: (TSX:GSPTSE, TSX:CADUSD)

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