Japan Household Spending Plunges 6.8% in September, Marking 10th Straight Monthly Decline

Japan's real household spending dropped 6.8% year-on-year in September, marking its tenth consecutive month of annual contraction and the steepest decline since September 2020. The reading missed expectations of a 3.0% to 3.1% fall, worsening from August's 3.1% drop. On a monthly basis, spending declined 2.8%, defying forecasts for a 0.3% increase. The slump occurred despite an eight-month run of real wage gains and a 1.7% increase in working households' real disposable income, potentially strengthening arguments against an aggressive Bank of Japan rate hike in December.