TOKYO (MNI) - Japanese real average household spending rose to Y287,789 in October, an inflation-adjusted 1.6% above the level of a year earlier, data from the Ministry of Internal Affairs and Communications showed on Friday.

Household spending rose in October rise for the third month in a row and the fourth month in the last five. The October gain was also stronger than the consensus call for a 0.6% rise.

The rise in October followed gains of 1.0% in September and 2.6% in August, a 2.0% drop in July and gains of 0.2% in June and 0.3% in May. The May rise was the first y/y gain in real terms in 16 months (since +3.6% in January 2008).

Real spending rose in seven of the 10 categories in October: medical care (+11.4%), transportation and communication (+4.7%), furniture and household utensils (+4.4%), culture and recreation (+1.6%), food (+1.5%), utilities charges (+1.4%) and other expenditures (+1.5%).

Spending fell on education (-4.6%), home repair and maintenance (-2.8%) as well as clothing and footwear (-2.3%).

In general, demand for low emission vehicles, including hybrids, has been supported by the government's tax breaks and subsidies. In addition, a reward program for buying greener consumer electronics has generated demand for certain models of TVs, refrigerators and air conditioners/heaters.

The average real income of salaried workers' households: October -1.8% y/y at Y459,704 vs. September -0.1%, down for the third consecutive month.

Real disposable income in the average salaried workers' household: October -1.9% y/y at Y387,048 vs. September -0.4%, down for the fifth consecutive month.

tokyo@marketnews.com ** Market News International Tokyo Newsroom: 81-3-5403-4833 **