MNI 5 THINGS: Japan Feb Retail Sales Rise Modest on Weather

     TOKYO (MNI) - The key points from preliminary February retail sales

released Thursday by the Ministry of Economy, Trade and Industry (METI).

     * Retail sales rose 1.6% in February, posting the fourth straight

year-on-year rise and coming in slightly firmer than the MNI median economist

forecast of +1.4%. The pace of growth remained moderate after +1.5% in January

and decelerating from +3.6% in December due to the lingering severe winter

weather.

     * The increase was led by high prices of fuels and vegetables as well as

continued solid demand for heaters and high-end electric appliances. The effect

of new models introduced earlier has waned, leading to a second year-on-year

drop in automobile sales.

     * Looking ahead, higher temperatures since mid-March may have supported

demand for spring clothing and other seasonal goods but stock markets remained

volatile, keeping consumer sentiment cautious.

     * On the month, retail sales rose 0.4% on a seasonally adjusted basis in

February, the first rise in two months after -1.6% in January and the ninth

increase in the past 12 months.

     * METI maintained its view that retail sales are "picking up moderately."

The three-month moving average of retail sales slipped 0.1% in December-February

from the previous three-month period, when it rose 0.1%.

     * Earlier this month, industry data showed department store sales fell 0.9%

in February for the third straight year-on-year drop as freezing temperatures

and heavy snowfalls across Japan discouraged people from going shopping and

dampened demand for spring clothing. Volatile stock prices also made consumers

more cautious about spending.

--MNI Tokyo Bureau; tel: +81 90-2175-0040; email: hiroshi.inoue@marketnews.com

--MNI Tokyo Bureau; tel: +81 90-4670-5309; email: max.sato@marketnews.com

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