Consumer spending fell in February but at a slower than expected pace as households scrambled to buy protective masks, toilet paper and food staples amid the worsening COVID-19 pandemic.
But spending on travel and entertainment slumped, according to government data released Tuesday, in a sign households were cutting back on nonessential purchases even before travel bans and social distancing policies took effect in March.
Analysts expect the hit to consumption from the pandemic to deepen significantly in coming months, with Prime Minister Shinzo Abe set to declare a state of emergency Tuesday that is likely to paralyze activity in major cities, including Tokyo, for a month.