Japan retail sales post first rise since tremor

Japan’s retail sales rose in June, marking the first gain since a devastating March earthquake and tsunami in a further signal of recovery in the world’s third-biggest economy, fresh data has revealed.

Sales rose by 1.1 per cent on-year, lifted by purchases of machines, appliances and electronic equipment, the Ministry of Economy, Trade and Industry said.

Sales of household appliances and electronic products jumped 15.2 per cent, driven in part by the rush of consumers to change to digital TV before the July 24 end of analogue broadcasting in Japan.

Apparel sales were also up 4.1 per cent, as were food and beverage sales, which increased 3.2 per cent.

However, automobile sales were down 17.3 per cent, with consumers deferring purchases and automaker production levels still recovering after post-quake power and parts supply shortages. Japan adopted a mentality of self-restraint in the aftermath of the March 11 earthquake and tsunami, which ravaged the northeast coast and left 20,000 dead or missing as well as crippling a nuclear power plant, triggering the worst atomic crisis since Chernobyl 25 years ago.

Convenience stores saw sales of items such as bottled water spike in the aftermath but consumers held off on non-essential purchases, entertainment and travel.

Retail sales fell 8.3 per cent in March and 4.8 per cent in April, before the decline slowed to a 1.3 per cent fall in May.

The drop in consumption helped push the economy back into recession in the first quarter of 2011.

Economists see reconstruction spending in the second half help the economy rebound, however.