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Japan’s Retail Sales Drop by Most in Nearly Two Years in May

  • Sales of cars, clothing and apparel decline from a year ago
  • Lack of robust wage gains is cited for weak consumer spending
Shoppers In Harajuku Ahead Of Japan Consumer Price Index Release
Photographer: Shiho Fukada/Bloomberg
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Japanese retail sales fell in May by the most in nearly two years, pointing to weaker consumption that could restrain any rebound in the economy following a contraction in the first quarter.

Weak retail sales, despite a string of national holidays early in the month, underscore that strong consumption has yet to take hold in Japan. That’s holding back the export-dependent economy. After a 2 percent surge in March, wage gains fell back to trend in April with a moderate 0.8 percent increase. That means consumers don’t have much extra free cash for discretionary spending.