MNI DATA IMPACT: BOJ Oct Consumption Index Rises For 3rd Month

The Bank of Japan's Consumption Activity Index rose for the third straight month in October as private consumption benefited from government subsidies to encourage domestic travel and eating out.

The index grew 0.9% m/m in October, following a 1.4% gain in September and 1.2% in August, data released by the BOJ Monday showed.

"Private consumption has picked up gradually on the whole, although consumption of services, such as eating and drinking as well as accommodation, has remained at a low level," was the BOJ's latest assessment.

The government launched its "Go To Travel" and "Eat" campaigns that included subsidies in October in a bid to revive tourism, hospitality and restaurant operators.

FRESH WAVE

Private consumption fell sharply in the second quarter as people were asked to stay home due to the pandemic.

Bank officials are worried about weaker private consumption from late November as social distancing resumed in the wake of a fresh wave of the coronavirus.

Japan's real average household spending fell 10.2% on year in September for the 12th straight drop.

The BOJ's Consumption Activity Index is designed to forecast revised private consumption, not act as a preliminary estimate.