Yen Appreciation, Sluggish Equity Markets and Weak Personal Consumption

「Meanwhile, persistently high raw-material and energy prices associated with the prolonged situation in the Middle East, as well as increases in the prices of essential goods resulting from prolonged inflation, are burdening household budgets, while consumers' preference for thrift and selective purchasing remains firmly entrenched.」

「During the interim consolidated accounting period, the Japanese economy as a whole continued to recover gradually, supported by improvements in employment and income conditions resulting from continued substantial wage increases and by resilient capital investment. At the same time, persistently high raw material and energy prices due to the prolonged situation in the Middle East, as well as rising prices for everyday necessities resulting from sustained inflation, have placed a burden on household finances, and consumers have continued to show a strong preference for saving and selective purchasing. In addition to interest-rate trends and foreign-exchange fluctuations associated with the Bank of Japan's shift in monetary policy, concerns over a slowdown in overseas economies and continuing geopolitical risks mean that the outlook remains uncertain.」

「Meanwhile, the sharp rise in crude oil prices caused by the situation in the Middle East is putting downward pressure on corporate earnings and households' real incomes. The outlook remains uncertain due to exchange-rate fluctuations and uncertainty in the global economy. Although personal consumption is expected to remain firm, supported by wage increases and the government's measures to address rising prices, successive price increases for essential goods are placing an even greater burden on households, and consumers' preference for thrift and selective purchasing remains firmly entrenched.」

「During the fiscal year under review, Japan’s economy remained on a gradual recovery trend, but the international situation and global economy became increasingly unstable against the backdrop of developments in the trade policies of major countries and rising geopolitical risks, and the outlook remained uncertain. Consumer spending was expected to recover as the employment and income environment improved, but higher prices increased the burden on household budgets through rising prices for necessities including food, further strengthening consumers’ cost-consciousness and focus on protecting household finances.」

「Although personal consumption is expected to recover as employment and income conditions improve, the recent rise in prices, particularly for food and other essential goods, has increased the burden on household budgets. Consumers' preference for thrift and defensive spending has therefore strengthened further.」

「During the interim consolidated accounting period under review, Japan’s economy showed signs of a gradual recovery, but the international situation and global economy became increasingly unstable amid developments in the trade policies of major countries and rising geopolitical risks, and the outlook remained uncertain. Although consumer spending was expected to recover as the employment and income environment improved, rising food prices due to higher prices overall, particularly the price of rice, a staple food, had a significant impact on household budgets, and consumers’ focus on protecting household finances strengthened further.」

「During the fiscal year under review, the economy gradually recovered against a backdrop of recovering foot traffic and improvements in the employment and income environment accompanying the normalization of social activity. However, the outlook remained uncertain because of concerns about deteriorating consumer sentiment resulting from sharply higher raw material prices and rising prices.」

「During the interim consolidated accounting period under review, the economy gradually recovered against a backdrop of recovering foot traffic and improvements in the employment and income environment accompanying the normalization of social activity. However, the outlook remained uncertain because of concerns about deteriorating consumer sentiment resulting from sharply higher raw material prices and rising prices.」

「During the cumulative first quarter under review, the economy gradually recovered against a backdrop of recovering foot traffic and improvements in the employment and income environment accompanying the normalization of social activity. However, the outlook remained uncertain because of concerns about deteriorating consumer sentiment resulting from sharply higher raw material prices and rising prices.」

「During the cumulative third quarter under review, Japan’s economy entered a gradual recovery trend as movement toward the normalization of social and economic activity strengthened, including the reclassification of COVID-19 to Category 5 under the Infectious Diseases Control Law. However, the outlook remained uncertain because of the prolonged situation in Ukraine and sharply higher energy and raw material prices. In the food retail sector, the business environment became even more challenging amid concerns including lower demand for food consumed at home as the restaurant and service industries recovered, weak consumer sentiment against a backdrop of higher prices, rising raw material and procurement prices, and higher operating costs such as personnel, utilities and logistics expenses.」

「During the cumulative second quarter under review, Japan’s economy entered a gradual recovery trend as movement toward the normalization of social and economic activity strengthened, including the reclassification of COVID-19 to Category 5 under the Infectious Diseases Control Law. However, the outlook remained uncertain because of the prolonged situation in Ukraine and sharply higher energy and raw material prices.」

「The outlook remained uncertain because of the prolonged situation in Ukraine and sharply higher energy and raw material prices. In the food retail sector, the business environment became even more challenging amid concerns including lower demand for food consumed at home as the restaurant and service industries recovered, weak consumer sentiment against a backdrop of higher prices, rising raw material and procurement prices, and higher operating costs such as personnel, utilities and logistics expenses.」

「During the fiscal year under review, social and economic activity in Japan was gradually normalizing as restrictions on behavior were eased. However, the outlook remained uncertain because of the impact of the prolonged situation in Ukraine and sharply higher prices resulting from rapid yen depreciation.」

「During the cumulative third quarter under review, Japan’s economy gradually moved toward normalization of social and economic activity as restrictions on behavior were eased under “living with COVID,” but the outlook remained uncertain because of the prolonged situation in Ukraine, sharply higher energy and other prices caused by rapid yen depreciation, and tight supplies of raw materials. In the retail sector, consumers’ focus on protecting household finances heightened further amid unstable social conditions, while costs increased because of higher procurement prices and electricity charges, resulting in an even more challenging business environment.」

「The outlook remained uncertain because of sharply higher crude oil and raw material prices resulting from the prolonged situation in Ukraine and the rapid depreciation of the yen. In the retail sector, consumers’ focus on protecting household finances heightened further because of rising prices and declining real wages, while costs increased because of higher raw material and procurement prices and electricity charges, resulting in an even more challenging business environment.」

「During the cumulative first quarter under review, although the impact of COVID-19 continued for an extended period, signs of a gradual normalization of economic activity emerged as restrictions on behavior were eased and vaccinations became more widespread. However, the outlook remained uncertain because of sharply higher crude oil and raw material prices resulting from the prolonged situation in Ukraine and the rapid depreciation of the yen. In the retail sector, consumers’ focus on protecting household finances heightened further because of inflation and declining real wages, while costs increased because of higher raw material and procurement prices and electricity charges, resulting in an even more challenging business environment.」

「During the fiscal year under review, Japan’s economy remained uncertain despite rising expectations for the normalization of social and economic activity as COVID-19 vaccinations progressed and treatments were developed. In addition to the nationwide spread of the sixth wave of COVID-19 infections caused by the Omicron variant, concerns remained about the impact of higher electricity charges and delivery fees resulting from sharply higher crude oil prices.」

「While progress in COVID-19 vaccinations and the development of treatments increased expectations for the normalization of social and economic activity, concerns remained about the possibility of a renewed spread of infection caused by the emergence of new variants and the impact on consumption of sharply higher crude oil prices, and the outlook continued to be uncertain.」

「During the cumulative second quarter under review, Japan’s economy remained in a challenging situation because of the continuing global spread of COVID-19. Although COVID-19 vaccinations progressed domestically, the situation remained unpredictable as repeated declarations of a state of emergency were issued and extended following a sharp increase in cases during the fifth wave, and the outlook for the economy remained uncertain. In the food retail sector, sales trends changed in line with fluctuations in the number of infections, and although consumption trends such as increased demand for stay-at-home consumption continued, growth in demand for food and daily necessities was slower than in the same period of the previous year.」

「In the food retail sector, although consumption trends such as increased demand for stay-at-home consumption continued because people refrained from going out to prevent the spread of infection, demand for food and daily necessities increased more slowly than in the same period of the previous year as some segments of the restaurant and service industries showed signs of recovery. Changes in consumer purchasing behavior resulting from the spread of infection, including lower visit frequency and increased online purchasing, also continued.」

「During the cumulative third quarter under review, Japan’s economy remained in an extremely challenging situation as the global spread of COVID-19 severely restricted social and economic activity, with requests for people to refrain from going out and the disappearance of inbound demand. Although some domestic economic activity showed signs of improvement, the timing of the end of the pandemic remained difficult to predict, and the outlook continued to be uncertain.」

「During the cumulative second quarter under review, Japan’s economy remained in an extremely challenging situation as the global spread of COVID-19 severely restricted social and economic activity, with requests for people to refrain from going out, requests for businesses to suspend operations and the disappearance of inbound demand. Even after the government lifted the state of emergency, the movement toward economic recovery remained slow, and the outlook continued to be uncertain.」

「During the cumulative first quarter under review, Japan’s economy deteriorated as the global spread of COVID-19 led to requests for people to refrain from going out and the disappearance of inbound demand.」

「The domestic economy is expected to remain firm, supported by recovering corporate performance and proactive capital investment. However, consumer spending is expected to remain uncertain and weak, as consumers’ cost-consciousness persists and concerns include the decline in domestic consumption resulting from efforts to contain the spread of COVID-19 and the impact of changes to the Tokyo Olympic Games schedule, which had been expected to stimulate the economy.」

「During the cumulative second quarter under review, Japan’s economy remained on a gradual recovery trend as corporate earnings and the employment environment continued to improve. However, the outlook became uncertain because of concerns about an economic recession resulting from the prolonged US-China trade friction.」

「During the cumulative first quarter under review, Japan’s economy remained on a gradual recovery trend as corporate earnings and the employment environment continued to improve. However, the outlook became uncertain as concerns about an economic recession began to emerge amid intensifying US-China trade friction.」

「The domestic economy is expected to remain firm, supported by recovering corporate performance and robust capital investment, while consumer spending is expected to remain weak as cost-consciousness persists.」

「During the cumulative third quarter under review, Japan’s economy remained on a gradual recovery trend as corporate earnings and the employment environment improved. However, stock prices and foreign exchange rates lacked stability because of the United States’ shift toward protectionism and instability in Japan’s domestic political administration, and the outlook remained uncertain. In the retail sector, consumption remained weak because of consumers’ deep-rooted cost-consciousness amid stagnant growth in real income.」

「In the retail sector, consumption remained weak because of consumers’ deep-rooted cost-consciousness. As competition intensified across business formats, costs including personnel and logistics expenses increased because of labor shortages throughout society and the need to respond to work-style reforms, and the challenging business environment continued.」

「During the cumulative first quarter under review, Japan’s economy remained on a gradual recovery trend as corporate earnings and the employment environment improved. However, stock prices and foreign exchange rates lacked stability because of the United States’ shift toward protectionism and instability in Japan’s domestic political administration, and the outlook remained uncertain.」

「Overall consumption showed signs of recovery, including an asset effect from rising stock prices, inbound consumption and increased spending by affluent consumers on high-priced goods. However, in the retail sector, consumption declined because of weather conditions, in addition to consumers’ cost-consciousness and heightened focus on protecting household finances, while the business environment remained challenging because of intensifying competition across business formats, rising labor costs due to labor shortages and higher logistics costs.」

「During the cumulative second quarter under review, Japan’s economy was gradually recovering, with capital investment and production activity remaining firm and corporate earnings recovering against the backdrop of government economic policies, while the employment environment also improved. However, the outlook remained uncertain because of uncertainty surrounding the policies of the new US administration and political developments in EU countries, as well as concerns about the emergence of geopolitical risks. In the retail sector, consumer spending continued to stagnate because of consumers’ cost-consciousness, price competition resulting from intensifying competition across business formats led to lower profits, and labor costs increased further because of higher social insurance expenses and the worsening labor shortage, resulting in a challenging business environment.」

「In the retail sector, the business environment continued to become more challenging as consumer spending stagnated because of consumers’ cost-consciousness, profits declined because of price competition resulting from intensifying competition across business formats, and labor costs increased because of the expanded application of social insurance and the worsening labor shortage.」

「However, uncertainty increased because of the slowdown in emerging-market economies, particularly China, the United Kingdom’s EU withdrawal issue, and the impact of policies under the new Trump administration in the United States, and the outlook remained uncertain. In the retail sector, although the consumption tax rate increase was postponed, consumers’ focus on protecting household finances heightened further because of concerns about the increasing burden on household budgets, including higher food prices caused by adverse weather and the expanded application of social insurance, and the business environment surrounding the industry became increasingly challenging.」

「In the retail sector, although the consumption tax rate increase was postponed, consumers’ focus on protecting household finances heightened further because of concerns about the increasing burden on household budgets, including higher food prices caused by adverse weather and the expanded application of social insurance, and the business environment surrounding the industry continued to become more challenging.」

「During the cumulative second quarter under review, Japan’s economy remained on a gradual recovery trend, but uncertainty in overseas economies increased because of slowing growth in emerging Asian economies and the United Kingdom’s withdrawal from the EU. Domestically, uncertainty surrounding stock prices and foreign exchange rates continued. In the retail sector, consumer sentiment remained stagnant despite major companies implementing wage base increases for the third consecutive year and the further postponement of the consumption tax increase, as consumers’ concerns about the future heightened their focus on protecting household finances.」

「The outlook for the economic environment remained uncertain, amid yen appreciation and a sluggish stock market caused by slowing emerging-market economies and uncertainty overseas. Consumer spending also remained weak, as rising consumer prices and gasoline prices, together with stagnant growth in real income, heightened consumers’ cost-consciousness.」