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Japan consumer confidence keeps improving in Oct. as virus fears ease

An arrival lobby at Tokyo's Haneda airport is crowded with people on Oct. 4, 2020, the first weekend after the Japanese capital was added to the "Go To Travel" government subsidy program to shore up domestic tourism that has been battered by the coronavirus pandemic. (Kyodo)

TOKYO (Kyodo) -- Japan's consumer confidence in October continued to recover from the economic fallout caused by the coronavirus pandemic, with concern easing as domestic infections remained stable, government data showed Thursday.

    The seasonally adjusted index of sentiment among households made up of two or more people, giving an indication of economic expectations regarding the coming six months, inched up to 33.6 from 32.7 in September, rising for the second straight month, according to the Cabinet Office.

    But the pace of recovery slowed compared with a rise of 3.4 points last month, when the number of infections slowed following a resurgence of over 1,500 new daily cases nationwide from late July to early August. The index fell 0.2 point in August.

    "Consumer confidence is slowly recovering, and I guess that is because the situation regarding the spread of the virus is becoming stable," a government official told reporters.

    The index has been improving since a record-low 21.6 was logged in April in the wake of the government's declaration of a state of emergency over the pandemic covering Tokyo and six other areas early in the month. Nonbinding requests for people to stay at home dented personal spending until the state of emergency was completely lifted in late May.

    A reading below 50 suggests pessimists outnumber optimists.

    The official added that the government-subsidized "Go To Travel" campaign, launched in late July to support the virus-hit domestic tourism sector, is likely to have boosted consumption.

    Travel to and from Tokyo was initially excluded from the program due to the high number of new infections, but the capital was added on Oct. 1.

    The Cabinet Office maintained its basic assessment saying consumer sentiment has "remained in a severe situation, but shown signs of recovery recently," after upgrading its view the previous month.

    After the summer resurgence, the number of newly confirmed cases has remained at around several hundred since September.

    All of the survey's four components also improved in the reporting month, with consumers' assessments of livelihoods and employment conditions both rising 1.1 points to 36.2 and 27.1, respectively.

    The assessment of income growth climbed 0.5 point to 35.3, while willingness to buy durable goods was up 0.8 point to 35.7.

    The consumer confidence survey, conducted between Oct. 7 and 20, covered 5,712 households made up of two or more people, with valid responses received from 5,323, or 93.2 percent.

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