Japan Retail Sales Rise the Least Since 2022

Retail sales in Japan rose by 0.3% year-on-year in July 2025, slowing sharply from a downwardly revised 1.9% gain in the previous month and falling well short of market expectations for a 1.8% increase.

This marked the 41st consecutive annual rise, but it was the slowest pace since February 2022, when sales declined by 0.9%, as inflation and sluggish wage gains eroded consumer purchasing power.

Growth was recorded in clothing and personal goods (8.0%), pharmaceuticals and cosmetics (3.9%), other retail sales (2.6%), and food and beverages (1.5%).

In contrast, sales fell for department stores (-5.8%), fuel (-4.9%), non-store retailers (-4.0%), automobiles (-2.6%), and machinery and equipment (-0.4%).

On a monthly basis, retail sales dropped by 1.6% in July, reversing a downwardly revised 0.9% increase in June and marking the steepest monthly decline since August 2021.