Japan’s Household Outlays Drop in Sign of Prices Hitting Demand

Japan’s households unexpectedly cut spending for the first time in six months, in a sign of the fragility of domestic demand as the Bank of Japan prepares to consider raising borrowing costs later this month.

Outlays by households adjusted for inflation fell 3% in October from a year earlier, led by spending declines in transport and housing, the Ministry of Internal Affairs and Communications reported Friday. Economists had expected a 1% gain.