Japanese household spending unexpectedly fell in May, raising the possibility that consumption will not be a major driver of the economy in the second quarter and complicating the outlook for the central bank’s next rate hike.
Real spending, adjusted for inflation, fell 1.8% from a year ago, the Interior Ministry reported Friday, missing the consensus forecast of a 0.3% increase. Spending fell 0.3% from April.
Components that drove the decline included spending on food, which fell 3.1% year over year, utilities and household durables. Spending on education and automobiles increased.
