MNI DATA IMPACT: Japan July Wages Drops; Real Pay Negative

--Japan July Average Wages -0.3% Y/Y, 1st Drop in 2 Months; June +0.4% 

--Japan July Real Average Wages -0.9% Y/Y; 7th Straight Drop; June -0.5% 

--Japan July Base Wages +0.6% Y/Y, 1st Rise in 7 Months 

--Japan July Overtime Pay +0.6% Y/Y, 1st Rise in 2 Months 

--Japan July Bonuses, Other Special Pay -2.2% Y/Y, June +1.1%

     TOKYO (MNI) - Average wages in Japan fell 0.3% year-on-year in July,

following a 0.4% rise in June, with real wages still in negative territory,

preliminary data released Friday by the Ministry of Health, Labour and Welfare

showed.

     The key points from the Monthly Labour Survey:

     --Total monthly average cash earnings per regular employee in Japan fell

0.3% year-on-year to Y377,334 in July, the first drop in two months following a

0.4% rise in June.

     --In real terms, average wages fell 0.9% year-on-year in July, the seventh

straight drop following a 0.5% fall in June. Total CPI minus impute rents rose

0.6% year-on-year in June, slowing from +0.8% in June.

     --Base wages, the key to a steady recovery in cash earnings, rose 0.6% in

July from a year earlier, the first rise in seven months after falling 0.1% the

previous month.

     --Overtime pay rose 0.6% year-on-year in July, the first rise in two months

after falling 1.0% in June. Bonuses and other special pay fell 2.2% on year in

July, reversing from +1.1% in June.

     --The weak bonuses in July would undermine the Bank of Japan view that

sluggish private consumption in July was caused by bad weathers. The weak

bonuses in the government data, which were consistent with the data released by

Japan Business Federation, or Keidanren, would increase a cautious view over

future spending.

     --The government left its assessment unchanged from the previous month,

saying that wages are increasing moderately.

--MNI Tokyo Bureau; tel: +81 90-2175-0040; email: hiroshi.inoue@marketnews.com

--MNI London Bureau; tel: +44 203-586-2225; email: les.commons@marketnews.com

[TOPICS: M$A$$$,M$J$$$]