Japanese household spending rose 5.2 percent in March from a year earlier in price-adjusted real terms, up for a third straight month, government data showed on Tuesday, in a sign that a recovery in consumer sentiment is helping consumption.
The rise was much bigger than the median market forecast for a 1.8 percent increase and followed a 0.8 percent rise in February.
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Spending rose 2.0 percent from February in seasonally adjusted terms as households spent an average 316,166 yen ($3,200), the Ministry of Internal Affairs and Communications said.
Spending by wage earner households rose 7.6 percent in March from the same month a year earlier.
Still, retail sales fell 0.3 percent in March from a year earlier, government data showed on Tuesday, down for a third straight month, in a sign the economic recovery is proceeding at a slow pace.
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The fall compared with the median market forecast for a 0.6 percent annual increase.
In other data, jobless rate fell in March and the availability of jobs improved, government data showed on Tuesday, in a sign of a gradual recovery in wider areas in the economy.
While Japan's industrial production rose 0.2 percent in March from the previous month, government data showed on Tuesday, in a sign that output is poised for a modest recovery as export demand gradually picks up. The rise compared with a median market forecast of a 0.4 percent increase, according to a Reuters poll.