Japan’s retail sales fell 0.9% year-on-year in December 2025, reversing from a 1.1% annual increase in November, according to data updated on 29 January 2026. The figures highlight a weakening in consumer spending momentum at the end of the year, a key concern for an economy that relies heavily on domestic demand.
The data are based on year-over-year comparisons, with the December result measuring changes relative to December a year earlier, while the November reading reflected changes versus November of the previous year. The swing from positive to negative territory suggests that tailwinds supporting consumption earlier in the year have faded, leaving retailers facing a more challenging environment as 2026 begins.
Market participants and policymakers are likely to watch incoming data closely to assess whether the December contraction is a one-off setback or the start of a more prolonged soft patch in household spending, which could carry implications for Japan’s broader growth outlook and policy stance.
