Key insights
- Japanese consumer confidence declined sharply in March due to rising fuel costs linked to the Middle East conflict. This complicates the BOJ's decision on raising interest rates and signals potential headwinds for global economic recovery, indirectly influencing US market sentiment.
TOKYO, April 9 (Reuters) - Japan’s consumer confidence worsened in March for the first time in three months, a government survey showed on Thursday, adding to growing signs that soaring fuel costs from the Middle East conflict were taking a toll on the fragile economic recovery.
An index measuring consumer mood stood at 33.3 in March, down 6.4 point from February, according to the survey conducted between March 6 and 23. It was the biggest month-on-month drop since April 2020 when the COVID-19 pandemic was rattling the world.
"Consumer sentiment is weakening," the government said, revising down its assessment from last month when it said confidence was showing signs of improvement.
The findings add to a recent slew of data highlighting the potential economic hit from the Middle East war, which complicates the Bank of Japan’s decision on whether to raise interest rates in April.