March 12, 2013 / 7:31 AM / 7 years ago

UPDATE 1-Japan consumer mood hits highest since mid-2007 in Feb

* Consumer confidence index at 44.3 in Feb vs 43.3 in Jan
    * Price expectations rise to 69.5 pct, highest since Oct
2011


    TOKYO, March 12 (Reuters) - Japan's consumer confidence
index hit its highest since mid-2007 in February with
expectations for price increases rising, in a sign an economic
recovery is gradually broadening.
    The Cabinet Office survey's sentiment index for households
of two or more people, which includes views on incomes and jobs,
was 44.3 in February from 43.3 in January.
    A reading below 50 suggests consumer pessimism.
    The survey also showed 69.5 percent of respondents think
prices will climb over 12 months, the highest since October 2011
and up from 65.3 percent the previous month.
    The survey comes as Prime Minister Shinzo Abe pushes
aggressive expansionary policies to help shore up the economy
and pull it out of nagging deflation.
    "Higher share prices partly led by Abe's policies helped
consumer confidence, which will also support the economic
recovery," said Yoshiki Shinke, senior economist at Dai-ichi
Life Research Institute.
    "Although the income situation has not been improved much,
private consumption will probably hold solid due to improving
sentiment."
    A recent gasoline price rise and expected increases in
imported goods prices due to the yen's weakness, as well as
Abe's calling for the Bank of Japan to strive to achieve its 2
percent inflation goal, helped to boost people's expectations of
higher prices, Shinke said.
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