Japan’s [B]Retail Trade[/B] unexpectedly fell just -2.5% in the year to July, the smallest drop since January. Economists had predicted a -3.5% decline ahead of the release. However, the improvement in the headline figure may not be indicative of a true rebound in consumer sentiment. Indeed, most of the improvement seems to have been driven by a 7.6% jump in motor vehicle sales, which can likely be chalked up to tax breaks on purchases of fuel-efficient cars that were included into the government’s fiscal stimulus package. Looking ahead, continued weakness in the labor market is likely to keep a lid on spending as layoffs weigh on disposable incomes.