Global| Oct 29 2007Japan Retail Sales Edge Back in Sept...Is Slowing Trend Still in Place?
Summary
Real retail sales surged in August but they fell in September. Still, the combination leaves retail sales net better off over the past two months. The Yr/Yr chart (real retail sales) shows that the downtrend that has been in place is [...]
Real retail sales surged in August but they fell in September. Still, the combination leaves retail sales net better off over the past two months. The Yr/Yr chart (real retail sales) shows that the downtrend that has been in place is blunted by these recent movements. Still retail sales in the quarter are going to be lower; they are falling at a 3.2% annual rate in Q3. The main nominal measures show distinct slowing as well.
Japan continues to be caught in between as the central bank looks for recovery and anticipates rate hikes and as the government plans for tax hikes to address Japan's excessive fiscal situation. Yet the economy, after a few hopeful quarters, has failed to deliver on the promise of growth and failed to let either of these policy moves occur. Moreover, the backsliding on the inflation front is a clear reminder of how fragile this economy is. The ongoing weakness in the yen should be a constant reminder of Japan’s weakness as export growth continues to drive growth. In short, Japan’s retail sales in September are not so encouraging despite the fact that they let much of the August strength stand.
| Japan Real and Nominal Retail Sales | ||||||||
|---|---|---|---|---|---|---|---|---|
| Nominal | Sep-07 | Aug-07 | Jul-07 | 3-MO | 6-MO | 12-MO | YrAGo | QTR Q3 Saar |
| Retail Total | -0.6% | 3.6% | -2.8% | 0.8% | 1.6% | 0.5% | 0.5% | -3.0% |
| Motor Vehicles and Parts | -6.5% | 8.0% | -0.4% | 2.3% | -1.9% | 0.0% | -6.9% | 3.4% |
| Food Beverages & Tobacco | 0.9% | 1.2% | -1.0% | 4.7% | -1.4% | 0.4% | 1.8% | -2.6% |
| Clothing footwear | -0.4% | 8.7% | -8.3% | -3.1% | 0.4% | -1.1% | -1.5% | -10.9% |
| Real | ||||||||
| Retail Total | -1.5% | 3.9% | -2.5% | -0.8% | -0.2% | 0.5% | -0.1% | -3.2% |
Robert Brusca
AuthorMore in Author Profile »Robert A. Brusca is Chief Economist of Fact and Opinion Economics, a consulting firm he founded in Manhattan. He has been an economist on Wall Street for over 25 years. He has visited central banking and large institutional clients in over 30 countries in his career as an economist. Mr. Brusca was a Divisional Research Chief at the Federal Reserve Bank of NY (Chief of the International Financial markets Division), a Fed Watcher at Irving Trust and Chief Economist at Nikko Securities International. He is widely quoted and appears in various media. Mr. Brusca holds an MA and Ph.D. in economics from Michigan State University and a BA in Economics from the University of Michigan. His research pursues his strong interests in non aligned policy economics as well as international economics. FAO Economics’ research targets investors to assist them in making better investment decisions in stocks, bonds and in a variety of international assets. The company does not manage money and has no conflicts in giving economic advice.
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