Japan consumers gloomier about economy-BOJ survey

Subscribe to Oneindia News

TOKYO, Oct 4 (Reuters) Increasing numbers of Japanese people feel that the economy has worsened as they face higher gasoline and food prices, and they are less optimistic about the year ahead, a Bank of Japan survey showed on Thursday.

Of the 2,179 participants in the quarterly survey, conducted between Aug 15 and Sept 10, 34.1 percent said economic conditions are worse than a year ago. This compares to 23.6 percent in the last survey in June.

Regarding the outlook for the year ahead, the proportion of pessimists stood at 29.6 percent, up from 24.7 in June.

More than 50 percent of respondents saw no change in economic conditions in the past year or the year ahead.

''An usual rise in responses saying circumstances have deteriorated appears to be the reason behind the decline in the headline reading,'' said a BOJ official.

''This is probably due to an increase in gasoline and food prices in the summer as those products are very close to people's livelihoods,'' he said.

The survey showed that 49.2 percent of respondents felt they were less comfortably off than a year ago. In the June poll, 43.0 percent gave the same response.

In the survey, 60.0 percent said prices have risen from a year ago, compared with 53.0 percent in June, while 71.7 percent said they expect prices to rise in a year ahead, slightly down from 71.8 percent in the previous poll.

But the inflation rate in the world's second-largest economy has recently been virtually nil or even negative, as government data showed last week that the core consumer price index fell from a year earlier for the seventh straight month in August.

Asked about interest rates, 57.2 percent said rates were too low, down from 60.7 percent in the previous survey, while 12.5 percent said rates were too high, up from 11.8 percent.

On a macro-economic basis, households have more savings than debt, in contrast to the corporate sector, which has more debt.

The central bank raised the key interest rate to a decade-high 0.50 percent from 0.25 percent in February, following its first rate hike in six years last July.

REUTERS SR PM1517

Please Wait while comments are loading...