Japanese consumer confidence slipped in June for the first time in six months as consumers reported slowing income growth and rising prices, exposing the challenges to Prime Minister Shinzo Abe’s plan to revive the economy by generating inflation.
Household sentiment fell 1.4 points from May to 44.3 in June, with the mood worsening for all four components — livelihood, income, jobs and spending appetite for durable goods, the government survey showed.
The survey showed 83.9 percent of respondents expect prices to rise a year from now, up 0.8 point from the previous month to the highest ratio in nearly five years.
Abe has pursued a policy of aggressive stimulus, dubbed Abenomics, to revive the economy and end 15 years of deflation. The early signs have been encouraging, but the plan in part relies on growth boosting wages — something yet to be seen.
Indeed, the survey’s index of income growth fell 0.6 point to 41.6 in June, the first fall in six months.