Daily cases have started creeping higher again at the national level driven by a renewed rise in infections in Tokyo and Osaka. We suspect that both cities will soon ask citizens to stay at home and request that establishments selling alcohol close temporarily. That would cause the recovery in consumer spending to stall. However, PM Suga has no appetite to roll out the kind of blanket national measures that could put the recovery into reverse. Indeed, the government is set to extent the Go To Travel campaign – which subsidises domestic tourism – until June in the third supplementary budget currently being compiled.
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