Japanese real household spending increased 0.6% MoM (vs 0.1% MoM expected) and was up 2.3% YoY (vs 1.2% YoY expected) in August, the strongest growth since May.

• Real income growth bounced to 2.8% YoY in August, the strongest so far this year, and real disposable income was up 1.9% YoY after declining in both June and July.

• Goods spending growth remained stable around 3.2% YoY, while services spending was up 5.5% YoY, the strongest in five months.
• Durable goods (+23.2% YoY) and semi-durable goods (+11.3% YoY) growth were both robust, driving overall consumer expenditure growth.
• By industry, spending on transportation & communication (+13.5% YoY) and culture & recreation (+12.2% YoY) were both expanding at a rapid pace, with growth in the latter being the highest in over two years.