Written by Satoshi Sugiyama and Tetsushi Kagimoto
TOKYO (Reuters) – Consumer spending in Japan fell for the 13th straight month in March, creating challenges for policymakers seeking to drive stronger real wage growth, a prerequisite for a hike in interest rates by the central bank.
Household spending fell 1.2% in March from a year earlier, official data released on Friday showed, versus economists' average forecast for a 2.4% decline and after a 0.5% decline in February.
On a seasonally adjusted monthly basis, spending also fell by 1.2%, much larger than the estimated contraction of 0.3% and rise of 1.4% in February.
The weak numbers came a day after Labor Department data showed real wages contracted for two years in a row, as rising costs of living outpaced nominal wages despite the largest wage increases in nearly three decades.
Weak household consumption is a concern for policymakers who want to see sustainable economic growth led by strong rising wages and strong consumer spending.
Separate data on Friday showed that Japan's current account surplus widened to 3.40 trillion yen ($21.9 billion) in March.
That compares with economists' average forecast for a surplus of 3.49 trillion yen in a Reuters poll.
For the fiscal year that ended in March, Japan's current account surplus reached a record 25.339 trillion yen, reflecting the trade surplus, cooling commodity prices and huge gains in primary income from overseas direct investment.
