Jul 28, 2011
Japan retail sales rise for first time since quake
Jul 28, 2011
TOKYO, July 28 (Reuters) - Japanese retail sales rose year-on-year in June for the first time since a devastating natural disaster in March as households snapped up energy-efficient goods to cope with electricity shortages, government data showed on Thursday.
Retail sales growth also accelerated from the previous month as consumers rushed to buy new TVs before the switch to digital from analogue broadcasting and bought summer clothes, but economists warned this one-off boost may soon fade and growth in consumption could slow.
Household spending has recovered quickly since a large earthquake and tsunami on March 11 triggered a nuclear meltdown, but growth in wages is likely to remain lacklustre due to rising uncertainty about overseas economies, and this could keep consumer spending subdued. "Households have been outperformers but their V-shaped recovery is now complete," said Takuji Okubo, chief economist for Japan at Societe Generale Securities.
"What happens from here on depends on wage growth and sentiment. The global economy looks fragile. We shouldn't expect too much from wages."
Japanese retail sales rose 1.1 percent in June from a year earlier, the government data showed. The rise compared with a median market forecast for a 0.5 percent annual decline and
followed a 1.3 percent decline in the year to May. Electronic equipment sales rose 15.2 percent in June from a year earlier as shoppers bought fans and air conditioners that consume less energy as a shift away from nuclear power exposes the country to energy shortages.
Consumers also replaced TVs before this month's switch to digital broadcasting from analogue, a government official told reporters. The rise in electronic equipment sales was the largest since
a 48.4 percent gain in November 2010, which was right before the government scaled back an incentive scheme for energy-efficient goods.
Many office buildings are using air conditioning less to save energy. This lead to a 4.1 percent rise in sales of clothing in the year to June as office workers bought more casual items, the official said.
Retail sales rose 2.9 percent in June from the previous month, on a seasonally adjusted basis. That was faster than a 2.4 percent rise in the previous month. Earlier this month, Japan's top retailer Seven & I Holdings raised its full-year earnings outlook above market expectations as consumers flocked to its convenience stores to stock up on essentials after the March 11 earthquake and tsunami.
Seven & I follows other retailers, which had initially been gloomy about their prospects in the wake of Japan's disaster, in reporting upbeat results and raising full-year forecasts.
By Stanley White
(Editing by Chris Gallagher)
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