Japan: Consumer confidence in freefall in September ahead of a sale tax hike
Consumer sentiment declined from 37.1 in August to 35.6 in September. The print represented the lowest reading since June 2011 and was below the 36.5 expected by market analysts. The consumer confidence index measures consumers’ expectations for the next six months on a scale of 0–100; a figure of 100 indicates that all respondents see their living standards improving.
Consumers were markedly more pessimistic about their willingness to buy durable goods. Despite declining, sentiment regarding overall livelihood, job prospects and income growth posted softer drops in the month. Regarding inflation, expectations of higher prices declined in September, with 87.6% of respondents expecting prices to trend higher (up 0.6 percentage points from last month’s survey).
Consumers were increasingly pessimistic ahead of a sales tax hike from 8% to 10% implemented on 1 October.