Japanese workers’ inflation-adjusted real wages rose in May at its fastest pace in two years, in an encouraging sign that higher wages could boost consumer spending and inflation.
The data showed real wages rose by 1.3 percent from a year earlier, the biggest annual increase since July 2016, following a 0.2 percent on yearly basis decline in April.
The data should be encouraging for the Bank of Japan, which is struggling until inflation reaches its target of 2% despite the continuation of its massive monetary stimulus policy over the last 5 years.
Nominal wages rose by 2.1 percent on yearly basis in May, the fastest annual rise since June 2003. The regular salary, which represents the bulk of monthly wages, rose by 1.5 percent in May on a yearly basis, the biggest rise since June 1997, while one-off special payments jumped by 14.6%.
