Japan Consumer Confidence: Updated March 28, 2024.

 

Japan's January consumer confidence rises to highest level in 2 years

Article Source:  https://mainichi.jp/english/articles/20240131/p2g/00m/0bu/046000c

Ideas:

Consumer confidence in any economy is very important and maybe even more important in Japan as consumer spending is always not what it should be. 

As consumer prices continue to ease, but not fall significantly it might take some time for the full effect of consumer confidence to be manifested in the Japanese economy.

For example a index number of 38.0 is not that great but it could increase with the continued decrease consumer prices and as consumers begin to feel more confident, creating a synergistic affect in the economy.

The challenges with the Japanese economy, for the most part, is Japanese consumers are not big spenders like US consumers, as Japanese are more savers, or used to be, and the US consumer is more spenders, or used to be.

Consumer confidence is a psychological situation and there can be many unknown variables to what consumers think, What is happening in an economy might have nothing to do with what consumers think or feel and it could be personal or family situations affecting consumer buying situations.

Expectations about the future, such as an increase in wages can improve the mood of Japanese workers and maybe they can expect a wage increase in April and they might spend a little more in the months leading to the April wage increase.

Lately the happiness index of Japan society has not been on the positive side and there seems to be more pessimists that optimists. 

But it wasn't always that way, or maybe it was/is, as Japanese society, for the most part, has been described and positive society, despite typhoons, earthquakes, the lost decade and so on.

Its natural, that after a devastating earthquake a region might be less optimistic and say a region that hasn't seen such destruction.

It might have take the Tohoku region, related to the 9/11 earthquake and tsunami to regain its optimism, and maybe even today, 12 years later the region might not be back to some kind of normal.

But again, consumer confidence, overall, has not been that great since the lost decade period of the 1990's and maybe won't change until real wage increases are part of the entire economy, and not just big company wage increases.

Until that time, consumer confidence is always going to be suspect as part of the the workers in the Japanese economy got wage increases and others didn't.

The buying of durable goods is usually not a daily purchase, or weekly purchase, or even a monthly purchase as maybe households plan when to buy or when they have to related to replacing older durable goods.

The increase in livelihoods most likely is related to an increase in wages, which many Japanese workers haven't seen for a very long time.

Single-member households are becoming more common in many countries and they are beginning a major consumer buying group and companies need to be aware that single-member households are gaining more economic power too.

The days of a husband, wife, and 2 children, unfortunately, might be a thing of the past, and even in so-called traditional Japan, as singles are becoming more of an economic force in all economies globally.

Have a nice day and be safe!