-- Spending by Japan's households declined in February from a year earlier, perhaps raising a challenge to the Bank of Japan's plans to tighten monetary policy.
Expenditures for two-or-more-person households in Japan in February reached an average of 289,391 yen, down 1.8% in real terms from the same month in 2025, reported the Statistics Bureau.
February marked the third month in succession that household outlays have declined in Japan, on year.
The declining outlays came despite a recently improving picture for family income.
The average monthly income per household with a worker logged at 589,038 yen in February, up 1.6% in real terms from the previous year, added officials.
Japan average household outlays on food, which absorb about 30% of family budgets, declined 0.5% on year in February, dragged down by sluggish seafood and seasoning-products purchases.
Spending on transportation and communication fell 5.9% on year, due in part to soft auto sales, reported the Statistics Bureau.
In contrast, family outlays on housing rose 12.1% on year in February, while spending on culture and recreation gained 10.8%, according to official figures.
For the Bank of Japan, the nation's soft household spending is a concern.
The central bank has reiterated it wants the demand for labor to be strong enough that real wages rise, thus allowing consumers to spend more and boost the overall economy.
However, the recent monthly spending surveys show households sitting on their wallets, conserving financial resources.
The next Bank of Japan policy session falls on April 27-28. The central bank has held its key rate unchanged since December.
According to Polymarket odds, there is a 62% chance the Bank of Japan will raise rates by 0.25% to 1%, at the pending meeting.