REPEAT: MNI 5 THINGS: Japan June Retail Sales Up on Costs

--Japan METI Keeps View: Retail Sales Trend Flat 

     TOKYO (MNI) - Japan's retail sales posted the eighth straight year-on-year

rise in June in light of higher costs for food and energy, high temperatures and

a rebound in department store sales, preliminary data released Monday by the

Ministry of Economy, Trade and Industry (METI) showed.

     The key points from the latest retail sales data:

     * Retail sales rose 1.8% on year in June for the eighth straight

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

forecast for +1.6%. The pace of growth accelerated from +0.6% in May, when there

were fewer public holidays compared to a year before, but was still lower than

the recent peak of +3.6% in December 2017.

     * The increase was supported by recent gains in the prices for food and

beverages as well as fuels, compared to year-earlier levels. Sales of fuels

accelerated to +16.7% y/y in June from +13.7% in May while those of food and

beverages rose 1.5% y/y in June after +0.7% in May.

     * On the other hand, sales of apparel fell 2.1% on year, the third

year-on-year drop, while those of vehicles posted the sixth straight y/y

decline, down 5.1% vs. -2.6% in May.

     * On the month, retail sales rose 1.5% on a seasonally adjusted basis in

June, the first rise in two months after -1.7% in May. The three-month moving

average rose 0.4% from the previous three-month period in June, marking the

first rise in two months.

     * METI maintained its view that retail sales are "flat." In February, it

downgraded its view for the first time since January 2016. Previously, it said

retail sales had been picking up moderately.

     * Industry data released last week showed department store sales rebounded

3.1% on year in June for the first y/y rise in two months after falling 2.0% in

May, thanks to early seasonal sales and strong demand for summer clothing amid

high temperatures. There was also one more Saturday in the month compared to

last year. The Japan Department Stores Association noted that spending by

tourists from overseas continued to post double-digit percentage gains on year

and that sales to wealthy consumers remained solid.

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