Retail Sales

Retail Sales measure the change in the total value of inflation-adjusted sales at the retail level, and are an important economic indicator of consumer spending, reflecting the broader economic activity. Higher than expected or rising figures for retail sales indicate a robust economy, increased consumer confidence and higher consumer spending, which leads to higher economic growth measured by the level of GDP, being positive for the Japanese Yen.
Retail sales are associated with other important economic indicators, such as wage growth, level of unemployment, level of inflation, demand for goods based on inbound tourism. The retail sales in Japan may be prone to seasonality, or extreme weather conditions, and indeed in October 2017, retail sales in Japan declined due to two typhoons. The latest reading for the retail sales in Japan was an increase of 2.2% on a yearly basis.
As the retail sales in Japan reflect the consumer spending, household earnings, strong levels of consumer spending makes it more likely that consumer prices will accelerate in the future, and this may change the monetary policy by the Bank of Japan, as inflation will start to rise gradually. Retail sales also reflect the consumer sentiment about the broader economy and current economic conditions.
They should be monitored for trends, as they may indicate early signals of strong economic growth or recession in Japan, which will influence the exchange rate of the Japanese Yen.