USD/JPY flows: Hosehold Spending Continue to Contract

The January Household spending is showing a dismay start for the Japanese economy in 2024. Japan January Household Spending contracted by 6.3% y/y from -2.5%y/y in December, month to month contraction is also higher than estimate. Looking at the bright side, we see wage growth accelerates and is expected to accelerate further after wage negotiation, which should support the recovery in consumption.

USD/JPY slips 0.14% to 147.83 as market increasingly speculate a March hike as Japanese officials white knight the poor household spending report swiftly.