Consumer Sentiment Deteriorates in Japan

Foreks - Consumer sentiment in Japan worsened in December, casting doubt on the central bank's view that strong household spending would support the economy and justify a rate hike. According to a survey conducted by the Cabinet Office, an index measuring consumer sentiment fell by 0.2 points to 36.2 in December compared to the previous month. Separate data indicated that Japan's output gap, which measures the difference between an economy's actual and potential output, remained negative in the third quarter from July to September. The results come ahead of the Bank of Japan's policy meeting scheduled for January 23-24, where some analysts expect a potential interest rate increase from the current 0.25%.