January 16, 2013 / 7:25 AM / in 5 years

UPDATE 1-Japan consumers cautious about economy and prices

TOKYO, Jan 16 (Reuters) - Japanese consumer confidence
slightly worsened in December, suggesting consumers remain
cautious despite some data showing signs of the economy
bottoming out.
    The survey also showed 59.6 percent of the respondents think
prices will rise over 12 months, steady from the previous month,
with new Prime Minister Shinzo Abe's aggressive stance on fiscal
and monetary policy yet to have an material impact on consumers'
price expectations.
    The survey's sentiment index for general households, which
includes views on incomes and jobs, inched down to 39.2 last
month from 39.4 in November, data from the Cabinet Office showed
on Wednesday.
    A reading below 50 suggests consumer pessimism.    
    "Winter bonuses and overtime work also fell last month, so
it will take more time for consumer confidence to recover," said
Takeshi Minami, chief economist at Norinchukin Research
    "I think Prime Minister Abe's aggressive stance on monetary
policy and fiscal spending is affecting business sentiment. But
we need see how these measures will actually affect the real
    He said consumer sentiment would likely lag a pick-up in the
economy by about six months.
    Abe, whose party surged to power in a lower house election
in December, pressed the Bank of Japan to set higher inflation
target and adopt bolder monetary policy to beat deflation. Most
of the people surveyed responded before the election. 
    The government approved on Tuesday a 13.1 trillion yen
($147.8 billion) extra budget, which includes 10.3 trillion yen
in economic stimulus spending to spur growth and end nagging
    A separate quarterly survey by the central bank showed on
Friday that 53 percent of the respondents expect prices to rise
a year from now, down from 62 percent in the September survey.
Of the total, 38 percent expect prices to remain largely
unchanged a year from now, while nearly 8 percent see them
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