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Japan's service sector sentiment falls amid consumer spending dropping

Staff Writer |
Sentiment in Japan's service sector dropped in May as workers in the retail sector saw a drop in spending in the recording period, a Cabinet Office survey showed.

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The monthly Economy Watchers survey's diffusion index, in which a score of more than 50 means people view current economic conditions in a positive light, fell 1.9 points to 47.1.

The Cabinet Office said that of those surveyed, some in the retail sector had experienced a lack of domestic consumer spending, while sales during the Golden Week holidays by visitors here also came in below par, the office said.

As a result of the reading, the Cabinet Office downgraded its assessment of business confidence, saying it "continues to be on a moderate recovery trend but appears to be in a temporary lull."

The Cabinet Office's assessment for May marks the first downgrade in service sector sentiment since January.

The Cabinet Office also said that conditions in the service sector would remain pressured looking ahead, with the sentiment index for economic conditions in the coming months falling 0.9 points from April to 49.2.

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