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2026-04-08 07:33:03
[Japan's real wages saw their biggest increase in five years in February, providing more justification for the central bank to raise interest rates] (1) Japan released its February data—real wages, adjusted for inflation, rose 1.9% year-on-year; total cash income rose 3.3% year-on-year; and overtime pay rose 3.3% year-on-year. (2) Japan's real wages rose 1.9% year-on-year in February, the biggest increase since May 2021 and the second consecutive month of growth. Average nominal wages (total cash income) rose 3.3% to 298,341 yen, the strongest growth in seven months. Basic wages (regular wages) rose 3.3%, the biggest increase in nearly 34 years; basic wages for full-time employees rose 3.7%, the highest since 1994. Overtime pay rose 3.3%, and special allowances rose 7.1%. (3) The growth rate of real wages accelerated significantly from the revised 0.7% in January, mainly due to the consumer inflation rate falling to 1.4% in February (the lowest in four years), with government subsidies offsetting the effects of a weak yen and rising oil prices. Steady wage growth has provided further justification for the Bank of Japan to raise interest rates again at its April 27-28 meeting, with the market widely anticipating a rate hike this month.
