— See Separate Table For Details of Individual Forecasts

TOKYO (MNI) – Japanese retail sales in December are expected to
show a 0.3% gain on year, slowing from a revised 1.5% rise in November,
due mainly to a slump in spending on consumer electronics and
automobiles, according to the median forecast of analysts surveyed by
Market News International.

The Ministry of Economy Trade and Industry will release the data at
0850 JST on Friday, Jan. 28 (2350 GMT on Thursday).

In November, retail sales rose 1.5% in November from a year
earlier, posting the first year-on-year rise in two months, thanks
largely to rush purchases of TVs and other electronic appliances.

This followed the 0.2% drop in retail sales in October, which was
the first fall in 10 months on fading effects of last-minute spending on
cars before the government ended subsidies for low-emission vehicles in
September and rush purchases of cigarettes before the Oct. 1 tobacco tax
hike.

Many shoppers rushed to retail stores before Dec. 1, when the
government halved the reward points it offers for buying TVs, air
conditioners/heaters and refrigerators that require less power to
operate.

This caused a pullback in sales of consumer electronics in the
following months. Sales of flat-screen TVs, for example, fell 50.8% on
year in December, after posting a 290% surge in November, according to
GfK Marketing Services Japan.

Automobile sales have also slumped since the rush of purchases
during the summer before the government ended its subsidy program for
buying energy-efficient vehicles in early September.

Passenger car sales posted a 31.6% y/y plunge in December, after
-33.5% in November, -28.8% in October, -5.4% in September and +49.0% in
August.

But the Cabinet Office expects the decline in automobile sales to
decelerate. It noted that seasonally adjusted sales of passenger cars,
whose engine displacement is 660cc or over, rose 7.3% on month in
December, recovering from -2.2% in November and -21.0% in October.

Meanwhile, fuel sales, back by higher gasoline prices as well as
lower temperatures, might have lent some support to December retail
sales. The average regular gasoline price in Japan stood at Y133 per
liter in the month, up 4.7% on year, following a 3.9% gain in November.

skodama@marketnews.com
** Market News International Tokyo Newsroom: 81-3-5403-4838 **

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