Tokyo, March 27 (Bloomberg) -- Japanese retail sales gained for a second month in February, a government report showed, as rising oil prices forced consumers to pay more for gasoline.
The value of sales at supermarkets, restaurants and other retailers rose a seasonally adjusted 1.9 percent from January, according to the Ministry of Economy, Trade and Industry. From a year earlier, sales fell 0.2 percent, less than the 2.4 percent decline forecast by economists surveyed by Bloomberg News.
Gains at gasoline stations masked declines at other retailers, suggesting that consumer demand -- which makes up more than half of Japan's economy -- may not be recovering. Crude oil prices driven higher by the looming conflict in Iraq have prompted refiners such as Nippon Oil Corp. to charge more for gasoline.
Retail sales ``are inflated by a rise in oil-related products,'' said Takehiro Sato, an economist at Morgan Stanley Japan. ``The stronger-than-expected retail sales wouldn't change my basic view'' that consumer spending is weak.
Record unemployment and falling wages are hurting consumer spending in the world's No. 2 economy. Household spending fell for the third month in January, denting sales at retailers such as Tokyu Department Store Co.
``Rising oil prices are boosting sales at energy-related retailers,'' said Takeshi Ito, a spokesman at the ministry. ``While oil prices may still rise, it's too early to say whether we'll see a sustained recovery in retail sales.''
Crude oil for May delivery rose as much as 61 cents, or 2 percent, to $29 a barrel in after-hours trading on the New York Mercantile Exchange, at 12:04 p.m. Tokyo time. Crude oil has risen by a third since January.
Tokyu Department Store, Japan's sixth-largest department store operator, said this week that sales for the year ended Jan. 31 fell 7.5 percent, marking the third year of decline.
Convenience Stores
Household spending probably fell in February for the fourth month in five as unemployment held at a record 5.5 percent, economists said. Spending by households headed by salaried workers probably fell 1.1 percent, according to the median of 16 forecasts in a Bloomberg News survey. The government will release spending and unemployment reports at 8:30 a.m. tomorrow.
The Topix Retail Index, which tracks the performance of 114 department stores, supermarkets and other retailers, rose 0.9 percent to 532.59 at 1:50 p.m. in Tokyo.
Seven-Eleven Japan Co., Japan's largest convenience store operator, led the gains in the sub-index after the ministry said convenience store sales at stores open at least a year rose 1.5 percent, the first gain in 31 months.
Consumers flocked to convenience stores to buy pre-paid highway cards in denominations of 30,000 yen ($250) and 50,000 yen before they were discontinued at the end of the month, the ministry said.
Sales in February at large retailers, defined as department stores and supermarkets, rose a seasonally adjusted 0.5 percent from January, the ministry said. Sales at large retail stores open at least a year rose 0.2 percent from a year ago.