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Household Spending for May 2024 -1.8% y/y

• expected 0.1%, prior 0.5%

For the m/m -0.3%

• expected +0.5%, prior -1.2%

Cited amongst reasons for the dramatic drop:

• higher prices continued to squeeze consumers' purchasing power

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Well, that's a terrible result! Japanese policymakers are trying to achieve sustained economic growth underpinned by rising wages and durable inflation. This is seen as a prerequisite to normalising monetary policy.

This sort of data result is not going to support Bank of Japan interest rate hikes though. At the margin a yen negative.