Fashion pulse: Japan - March 2026

Consumer prices (March)

Tokyo consumer prices rose 1.4 percent year-on-year in March, slower than the 1.5 percent recorded in February, according to Japan’s Statistics Bureau. The capital’s core index — excluding fresh food — eased to plus 1.7 percent from plus 1.8 percent, the smallest gain since April 2024. Tokyo CPI leads national figures by roughly three weeks, and signals broad-based cooling from processed food prices down the chain. National clothing and footwear inflation last read plus 2.1 percent year-on-year in February, above the 1.3 percent headline rate — a gap that has persisted since the yen weakened sharply in late 2024. Japan imports 97 to 98 percent of its clothing, so import costs drive the fashion price story even as headline inflation slows.

Department stores and retail (March)

Department stores delivered a strong March. J. Front Retailing, which operates Daimaru Matsuzakaya, reported March department store sales up 4.9 percent year-on-year, driven by corporate sales and duty-free trade, according to the company’s consolidated sales report. Across major operators, duty-free sales rebounded in March after months of weakness tied to fewer Chinese tourists — a tentative signal that the inbound-luxury channel is stabilising. Clothing accounts for 26.9 percent of Japanese department store sales, making this channel more important for fashion than in most Western markets. The Japan Department Stores Association (JDSA) publishes monthly association-wide data with city and product splits, and the Japan Council of Shopping Centers (JCSC) provides comparable colour from the shopping-centre channel.

Tourism (February)

Japan received 3.47 million international visitors in February, up 6.4 percent year-on-year and a record for the month, according to the Japan National Tourism Organization (JNTO). South Korea led with 1.09 million arrivals (up 28.2 percent), Taiwan contributed 694,500 (up 36.7 percent), and the United States 219,700 (up 14.7 percent). Chinese arrivals fell 45.2 percent to 396,400 on the back of a travel boycott, but 18 source markets set February records. Fashion shopping remains a core driver of inbound spend — Ginza, Omotesando and Shinsaibashi all benefit from the weak-yen dynamic that has made Japanese fashion retail an effective duty-free destination for Asian visitors in particular.

Sentiment and macro (March)

The Cabinet Office’s consumer confidence index plunged to 33.3 in March from 39.7 in February — the biggest one-month drop since the April 2020 COVID shock — far below consensus of 38.0. The share of respondents expecting higher inflation a year from now jumped to 93.1 percent, the highest reading since September. The Bank of Japan (BOJ) held its policy rate at 0.75 percent at its March meeting, the highest level since 1995, while the yen traded near 150 to the US dollar. The Cabinet Office’s Economy Watchers Survey, which polls retail workers, restaurant staff and other street-level observers across 11 regions each month, offers additional fashion-specific colour on how households are shifting spend in response to the price pressure. The BOJ’s Tankan survey had put non-manufacturer large-firm sentiment at 36 in March, near the highest since 1991, so business confidence and household confidence are now moving sharply in opposite directions.

The bottom line: Japan’s fashion market enters spring with two clear signals pointing in opposite directions. Department stores and tourist-driven retail had a strong March, supported by a rebound in duty-free sales and record February visitor numbers — but household confidence posted its sharpest drop since COVID, with inflation expectations at multi-month highs. For brands in Japan, the weak yen continues to work both ways: it lifts tourist spend but squeezes import margins and consumer wallets. Expect promotional activity to rise in April and May if the consumer confidence signal persists.

Note: the figures in this article are based on different reporting periods. Some indicators are already available for March 2026, while others are reported with a time lag due to survey and publication cycles. This is common practice in official statistics and nevertheless allows for a reliable assessment of current market trends.