Japan Retail Sales Up 3.2% in June As Growth Slows

Japan’s retail sales in June rose for the sixth straight month, but the pace of growth is slowing.

The government said Thursday that June retail sales climbed 3.2 percent from a year earlier. While the June result was in line with economists’ projection, the pace of growth was slower than March and April when retail sales jumped almost 5 percent.

“Growth in retail sales was modest. By sectors, we saw strong growth in auto sales, but that was mainly due to government incentives,” said Hideki Matsumura, economist at Japan Research Institute, referring to tax breaks and government subsidies for the purchase of energy-efficient vehicles.

Auto sales in June jumped 12.4 percent year-on-year, while household machinery sales increased 4.9 percent.

Government stimulus measures to support auto sales will expire in September. Matsumura said auto demand is likely to slacken after October amid Japan’s feeble economic recovery.

Sales at large retail stores fell 3.0 percent in June, down for the 27th consecutive month, underlining a deep slump in Japan’s consumer demand.

TOKYO (AP)