Japan's Household Spending Down 5.1% Due To Cash Handouts

Japan's household spending fell a real 5.1 percent in June from a year earlier, as the previous year's consumption was largely supported by a cash handout program and economic resumption after the initial shock of the coronavirus pandemic, government data showed, Mainichi Japan reported.

Photo Insert: Japan, like many other countries around the world, has yet to regain its pre-pandemic footing.

Average spending by households with two or more people in real terms was 260,285 yen ($2,370), marking the first decline in four months, according to the Ministry of Internal Affairs and Communications.

With the aim of easing the economic fallout from the pandemic, the government started the across-the-board 100,000 yen cash handout per person in May last year, boosting purchases of home appliances and other items the following month, a ministry official told reporters.

In 2020, household spending plunged 11.1 percent from a year ago in April and 16.2 percent in May, largely affected by the country's first virus emergency from early April through late May, but the margin of the drop was significantly reduced to 1.2 percent in June as social and economic activities gradually resumed.

Under the first virus emergency, people were asked to stay home and non-essential businesses to suspend operations, dealing a heavy blow to the economy.

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