Japan Household Spending

Household spending in Japan increased by 2.3% yoy in August 2025, exceeding market consensus of 1.2% and accelerating from a 1.4% growth in the previous month. It was the fourth straight month of rise in personal expenditure and the strongest pace since May, supported by government support measures aimed at mitigating cost pressures and the impact of new U.S. tariffs. Expenditures continued to rise for fuel, light & water charges (4.7% vs 4.8% in July), medical care (1.7% vs 11.5%), transportation & communication (13.5% vs 14.8%), and education (16.9% vs 9.5%). At the same time, spending rebounded for clothing & footwear (5.4% vs -0.4%) and culture & recreation (12.2% vs -4.1%). In contrast, expenditures weakened for food (-1.2% vs -1.8%), housing (-0.7% vs -5.9%), and furniture & household items (-6.8% vs 0.8%). On a monthly basis, spending rose 0.6%, topping forecasts of 0.1% but slowing sharply from July's 1.7% gain.