Japan Retail Sales Unexpectedly Rise

Retail sales in Japan rose 1.8% yoy in January 2026, rebounding from a 0.9% decline in the previous month and beating market forecasts for a 0.4% fall. It marked the fastest growth since last June, boosted by recent fiscal stimulus measures from Tokyo, including targeted consumption vouchers and tax incentives designed to encourage household spending. Sales expanded for machinery and equipment (12.4%), automobiles (9.6%), other retail goods (3.0%), department stores (2.8%), food and beverages (1.8%), and pharmaceuticals and cosmetics (1.7%). In contrast, turnover declined for fuel (-7.3%), non-store sales (-5.3%), and clothing and personal goods (-2.1%). On a monthly basis, retail trade grew 4.1%, reversing a 2.0% decline in December and marking the strongest pace since September 2019.

Retail sales in Japan unexpectedly dropped 0.9% year-on-year in December 2025, reversing an upwardly revised 1.1% increase in the previous month and defying market expectations of a 0.7% rise. This marked the first decline in retail turnover since August, reflecting that households had already met their year-end needs in the previous month, supported by rising wages. Sales decreased for clothing and personal goods (-11.6%), fuel (-10.8%), non-store retailers (-5.8%), department stores (-0.5%), and food and beverages (-0.4%). By contrast, retail trade increased for other retail categories (6.1%), automobiles (5.9%), machinery and equipment (5.9%), and cosmetics (0.1%). On a monthly basis, retail sales fell 2.0% in December after an upwardly revised 0.7% gain in November, marking the first monthly decline in four months.

Retail sales in Japan rose 1.0% year-on-year in November 2025, slowing from a 1.7% increase in the previous month but surpassing market expectations of 0.9%. This marked the third consecutive month of growth in retail turnover, supported by resilient household spending on essentials heading into year-end, steady wage gains, and a recovery in inbound tourism. Sales increased for machinery and equipment (7.1%), pharmaceuticals and cosmetics (5.6%), automobiles (3.9%), other retail categories (3.8%), department stores (2.0%), and food and beverages (1.1%). By contrast, retail trade declined for clothing and personal goods (-7.5%), fuel (-5.6%), and non-store retailers (-5.5%). On a monthly basis, retail sales rose 0.6% in November, easing from a 1.6% gain in October, which was the strongest increase since September 2021.