By Leika Kihara
TOKYO, March 8 (Reuters) - Japan's service-sector
sentiment rebounded in February for the first time in four
months, a government survey showed on Wednesday, a sign that the
removal of COVID-19 curbs is giving a much-needed boost to the
country's sluggish consumption.
The outcome offers some relief for policymakers fretting
that rising living costs could discourage households from
shopping and travelling, thereby derailing Japan's delayed
recovery from the scars of the pandemic.
The survey of workers such as taxi drivers, hotel workers
and restaurant staff, called "economy watchers" for their
proximity to consumer and retail trends, showed their confidence
about current economic conditions stood at 52.0 in February, up
3.5 points from the previous month.
"With more events and concerts being held, passenger numbers
for international and domestic flights are starting to return to
pre-pandemic levels," a taxi driver was quoted as saying in the
survey.
There is also hope the government's decision to ease COVID
restrictions on travellers from China will give a boost to
retailers and other industries reliant on inbound tourism.
"We're seeing clear signs of recovery in travel demand,
which has been lacklustre so far," a travel agency was quoted as
saying in the survey.
Shares of Japanese retailers rallied on Wednesday on
optimism for a return of mainland Chinese tourists, helping lift
the Nikkei stock average to a 3-1/2 month high.
But the survey also quoted a convenience store operator as
saying that companies and households were seeing budgets
squeezed by rising utility bills, suggesting the outlook for
consumption remained murky.
Japan's economy averted recession in the fourth quarter but
rebounded much less than expected due to soft capital
expenditures, highlighting the fragile state of the country's
recovery.
While policymakers hope households will boost spending with
savings accumulated during COVID curbs, soaring fuel and raw
material costs have eroded purchasing power.
Real wages fell by the most in nearly nine years in January
as inflation hit a four-decade high, data showed on Tuesday,
boding ill for the outlook for consumption.
(Reporting by Leika Kihara; Editing by Kim Coghill)
Messaging: leika.kihara.reuters.com@reuters.net))
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