June 04, 2024 23:58 GMT
Headline Wages Rise As Negotiated Increases Start To Impact Data
JAPAN DATA
Japan April wage outcomes were firmer than forecast in terms of the headline results. Labor cash earnings rose 2.1% y/y (against a 1.8% forecast and a revised 1.0% March gain). Real earnings were -0.7%y/y, against a -0.9% forecast and -2.1% in March.
- Scheduled pay (not on a same sample basis) rose 2.3% y/y, up from 1.7% in March.
- The Japan authorities will be looking for further improvement in real wage outcomes (trending back above 0%), which is a key policy objective to ensure a recovery in consumption spending and sustainably achieving the 2% inflation target.
- It was a bit more mixed in terms of cash earnings on a same sample base. In y/y terms we rose 1.7%y/y, versus 2.1% forecast and 1.9% prior (which was revised down from 2.2% initially reported). The trend looks a little softer for this metric, but remains above 2023 lows.
- Scheduled full time pay on a same base basis rose 2.1%y/y, in line with expectations and unchanged from March.
- The recently negotiated wage outcomes, where workers secured a +5% wage gain will have impacted today's data. The BoJ suggests around 40% of the annual gain will be reflected in the April data, while 80% will factored in by July (see this BBG link).
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