Hit by a tax hike, lower real wages and higher prices, Japanese households have been cutting back on spending, and the GDP data on Wednesday is expected to confirm they are holding back economic growth.
"Real wages have fallen by around four percent since Prime Minister Shinzo Abe came to power and household spending will be the big swing factor for economic growth going forward," Capital Economics' Japan economist Marcel Thieliant told CNBC by phone.
Just when a weaker yen had been pushing up the cost of imported goods, Japanese consumers were hit in April 2014 by the first consumption tax hike in seventeen years.
In response, Japan's households have been slashing their spending and unwittingly helped tip the economy into a technical recession from which it has struggled to emerge from.
Gross domestic product (GDP) data due Wednesday is expected to show the world's third-largest economy grew and annualized 1.5 percent for the three months ending March 2015, unchanged from October-December's revised reading. The economy contracted in both the second and third quarters of 2014.
"Household spending is the chief factor holding back economic growth and there is no sign of consumers starting to spend again," Mizuho Securities' chief market economist Yasunari Ueno told CNBC by phone. "And nothing, not exports nor investments – not even public investments, is compensating for the weakness in consumer spending," he said.
Tight-fisted Mrs. Watanabe
So far, the data suggest that Mrs. Watanabe has no intention of loosening her tight grip on households' purse strings.
In the three months following the April 2014 tax hike, consumer spending contracted by five percent quarter-on-quarter, and only inched by 0.3 percent and 0.5 percent in the two following quarters, respectively.