January household spending, retail sales in Japan seen falling

Tokyo

JAPANESE households cut spending further and retail sales fell for the first time in seven months in January, data on Friday is likely to show, a sign the central bank's radical stimulus has yet to convince consumers that inflation will take hold.

After limping out of recession in the final quarter of last year, the world's third-largest economy is showing signs of life as exports and output rebound on solid US and Asian demand.

But the weak consumer mood has kept a lid on spending as wages have yet to increase enough to make up for the sales tax…