— Japan June Retail Sales Pushed Up By Auto, Fuel Sales
— Japan June Retail Auto Sales +12.4% Y/Y Vs May Revised +13.4%
— Japan June Retail Fuel Sales +8.4% Y/Y Vs May +18.9%

TOKYO (MNI) – Japanese retail sales rose 3.2% in June from a year
earlier, the sixth straight year-on-year increase, following a revised
2.9% gain (preliminary +2.8%) in May, data from the Ministry of Economy,
Trade and Industry released on Thursday showed.

Continued solid sales of motor vehicles and fairly high fuel prices
boosted overall retail sales. Auto sales rose for the 13th consecutive
month from year-earlier levels. Fuel sales posted the seventh straight
y/y gain, although gasoline prices have fallen in recent weeks.

Retail sales have recovered from -5.7% in February 2009, which was
the largest y/y drop in seven years. In January this year, retail sales
rose 2.3%, the first y/y gain in 17 months.

The growth in June retail sales was led by year-on-year increases
in six out of seven major categories: motor vehicles (+12.4%), fuel
(+8.4%), clothing (+5.3%), machinery and equipment including consumer
electronics (+4.9%), other retail sales (+1.6%) as well as food and
beverages (+1.0%).

Meanwhile, year-on-year declines were seen in sales at department
stores and supermarkets (-3.7%).

Motor vehicle sales continued to be supported by tax breaks and
subsidies for buying low-emission vehicles.

But the 12.4% rise in auto sales in June was slower than the
revised +13.4% in May, +19.5% in April and +21.0% in November 2009,
which was the largest y/y gain since March 1997.

The 8.4% rise in fuel sales in June was the seventh consecutive
month of y/y gains but the rate of growth slowed sharply from +18.9% in
May and +23.0% in April. The 9.0% rise in December 2009 was first
year-on-year gain in 15 months.

Fuel sales have recovered from the record y/y drop of -23.3% marked
in February 2009.

Retail gasoline prices were on a general uptrend from mid-January
2009 until May 31, when they began to ease.

In the week to July 26, the average price of regular gasoline in
Japan fell to Y134.5 ($1.53) per liter, or $5.81 per gallon, from Y135.0
last week, the ninth consecutive weekly drop.

The price was still higher than the Y125.3 per liter price of a
year earlier.

Sales of machinery and equipment gained 4.9% in June, marking the
10th consecutive y/y gain, thanks to the government’s reward program for
purchases of greener consumer electronics including flat-screen TVs,
refrigerators and air conditioners.

However, the pace of y/y gains in this category also decelerated
from a revised +5.9% in May and +13.8% in April.

Other details from the latest data:

Commercial sales, or combined sales at the wholesale and retail
levels (y/y): June +1.2%, the fourth consecutive year-on-year rise,
following +1.3% in May, +3.6% in April and the record -24.3% marked in
May 2009.

Sales at the wholesale level (y/y): May +0.5%, also up for the
fourth consecutive year-on-year gain, after +0.7% in May and +3.1% in
April and recovering from the record -30.3% hit in May 2009.

Large retail store sales on a same-store adjusted basis (y/y): June
-3.0%, the 27th straight y/y drop, vs. May revised -3.9%.

Large retail store sales, unadjusted (y/y): June -2.4%,the 23rd
consecutive y/y drop, vs. May revised -3.2%.

tokyo@marketnews.com
** Market News International Tokyo Newsroom: 81-3-5403-4833 **

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