Japan's Real Household Spending Decline Second Consecutive Year, Shipping Companies Estimate Sharp Plunge In Profit

Akira Ito
09 May, 2025
Tokyo

Japan's market indexes advanced in Friday's trading and extended weekly gains following a key economic report on personal spending and real wages. 

The Nikkei 225 Stock Average gained more than 1%, and the broader Topix advanced nearly 1.5%, and indexes traded near six-week highs. 

Japan's nominal cash earnings in March increased at a slower pace of 2.1% from the revised 2.7% increase in February, according to the latest data available from the Statistics Bureau of Japan. 

Nominal wages per worker, including base and overtime payments, increased 2.1% to 308,572 yen, according to a report by the Ministry of Health, Labor, and Welfare.  

Real wages, after adjusting for inflation, declined 2.0% from a year ago, denting the consumer's appetite. 

Japan's household spending in March rose 2.1% from a year ago in real terms to 339,232 yen, driven by higher electric bills and a rise in tuition fees for private universities. 

The two separate reports calculated real wage and spending data by adjusting nominal figures with the consumer price inflation of 4.1% in March, lower than the 4.3% rate in February. 

Investors remained skeptical about the trade deal between the U.S. and UK, as few details were available after the White House announcement. 

About 3% of the U.S.'s total imports arrive from the U.K., and the average tariffs paid by the U.S. importers amount to less than 2%. 

However, the U.S. president claimed that the UK's imports would be slapped with higher tariffs of 10%, and the Trump administration agreed to drop the proposed 25% tariffs on British steel and aluminum to zero.

For now, the U.S. proposed to limit tariffs to 10% on the first 100,000 automobiles imported  from the U.K., and the U.S. is the top destination for British passenger cars worth about £9 billion. 

 

Japan Indexes and Stocks 

The Nikkei 225 Stock Average advanced 1.6% to 37,516.70, and the broader Topix index gained 1.4% to 2,735.39. 

Japan's three leading shipping companies traded down after they estimated a sharp decline in earnings in the current fiscal year. 

The shipping companies confirmed that the Trump administration's tariffs are having negative impacts on shipping volume and freight rates. 

Net income at Nippon Yusen is likely to fall 47.7% to 250 billion yen, at Kawasaki Kisen Kaisha to plunge 67.3% to 100 billion yen, and at Mitsui O.S.K. Lines to shrink by 60% to 170 billion yen. 

Nippon Yusen decreased 1.1% to ¥4,838.0, Kawasaki Kisen Kaisha dropped 0.7% to ¥1,999.50, and Mitsui O.S.K. Lines rose 1% to ¥4,629.0.