Japan is starting to lose its edge as a shopping holiday destination for Mainland Chinese.

Mainland Chinese shoppers are likely to become increasingly discouraged by the rising value of the Japanese yen against the yuan, according to analysis by Nikkei and Nomura International.

While the Chinese accounted for just 1 per cent of Japan’s total retail spending in 2015, the share was rising and the total Japanese retail market is huge, given the wealth of its population. By comparison, Mainland Chinese account for close to 50 per cent of retail sales in Hong Kong and 30 per cent in Macau, according to Nomura. (Those figures exclude categories like cars and fuel).

Hong Kong luxury retail sales are down by as much as 25 per cent due to the absence of wealthy mainlanders who have chosen to visit Japan, Korea, Europe and even the US thanks to more favourable exchange rates last year. Last year 4.99 million mainlanders visited Japan, attracted by the value of the yen and relaxing of visa restrictions. The average spend per visitor rose 20 per cent.

However the advantage Japan held is slipping as the yuan weakens against the yen. In January, 1 yuan bought 18 yen, at its peak last May it bought 20. Today it buys just 16.

Chinese tourist spending in Japan fell 10 per cent in the first quarter, accounting now for just 0.8 per cent of the total market, according to data from Japan’s Ministry of Economy, Trade and Industry. Their spend has fallen two months in a row.