Japanese consumer sentiment has stayed near a record low in September as stocks tumbled, reinforcing concern that spending at home is unlikely to prop up the faltering economy.
The sentiment index rose to 31.4 last month from 30.1 in August, which was the lowest since the government began the survey in 1982, the Cabinet Office said yesterday in Tokyo.
The global financial crisis wiped US$970 billion from the Tokyo Stock Exchange's first section and caused the Nikkei 225 Stock Average to lose a quarter of its value since August, Bloomberg News reported.
Central bank Governor Masaaki Shirakawa said last week that Japan's recovery may be delayed as worldwide market turmoil threatens exports.
"Looking at the plunge in stocks must be depressing for households," said Yoshiki Shinke, a senior economist at Dai-Ichi Life Research Institute in Tokyo. "Japan's recession will get deeper over the next six months."
The Nikkei had its biggest gain on record yesterday, advancing 14.2 percent as governments around the world pledged to support their banks to avert a global financial collapse.
Rising prices and falling wages are also squeezing households, whose spending accounts for more than half of the economy. Consumer prices, excluding fresh food, climbed 2.4 percent in August, the fastest pace in more than a decade, while wages that month fell for the first time this year.
Aeon Co, Japan's largest supermarket operator, last week posted its sixth straight decline in quarterly profit, saying inflation and stagnant wage growth sapped demand.
"In this harsh economic environment we face an increasing cost-conscious consumer," the company said.
A decline in energy prices provided some relief for consumers, helping sentiment improve from the previous month, the government said. Prices at the pump have declined 5.8 percent since August.
"Confidence rose because of easing oil prices," Shigeru Sugihara, deputy director-general at the Cabinet Office, told reporters. "But given the condition of financial markets, I'm not sure consumer sentiment will keep improving."
