A government survey on Wednesday showed that consumer sentiment in Japan worsened in December, casting doubt on the central bank's view that solid household spending would support the economy and justify interest rate hikes. The survey results were released ahead of the Bank of Japan's policy meeting on January 23-24, with some Analysts forecasting a possible interest rate hike at that time. According to a survey by the Cabinet Office of Japan, the Index measuring consumer confidence in December fell to 36.2, down 0.2 percentage points from the previous month. Another dataset revealed that Japan's output gap, which measures the difference between actual and potential output of the economy, has been negative for the 18th consecutive quarter from July to September. A negative output gap indicates that actual output is below the economy's full running capacity, which is regarded as a sign of weak demand. This data highlights the fragility of the Japanese economy as rising living costs and uncertainties surrounding President-elect Trump's policies in the USA have put pressure on Japanese consumption and exports.