TOKYO (Reuters) – Japan’s April household spending likely tumbled at the fastest pace in decades, a Reuters poll showed on Friday, as the nation’s state of emergency to fight the spread of the coronavirus prompted people to stay home and businesses to close.
The depth of the economic fallout from the pandemic in the current quarter has already been signaled by April data for exports, factory output and the jobs market, with the broader economy having already slipped into recession in the March quarter.
Household spending is forecast to have fallen 15.4% in April from a year earlier, the poll of 13 economists showed, heralding the biggest decline since comparable data became available in 2001.
In March, the spending fell 6.0%.
From the previous month, household spending is expected to have fallen 8.7% in April from a 4.0% decline in March.
“Spending is expected to pick up from June as the government lifted the emergency status in stages in May but it likely fell deeply in April-June compared with January-March,” said Koya Miyamae, senior economist at SMBC Nikko Securities.
The government will announce household spending data at 8:30 a.m. on June 5 (2330 GMT, June 4).
The government this week approved a new $1.1 trillion stimulus package that includes significant direct spending, totaling $2.2 trillion, or about 40% of gross domestic product, in a bid to help the economy through what is expected to be its deepest post-war slump.
(This story has been refiled to insert dropped word in headline)
(Reporting by Kaori Kaneko; Editing by Simon Cameron-Moore)
