Japan’s nominal wages, or average monthly cash earnings, rose by 4.5% yoy in June, significantly exceeding expectations of a 2.3% yoy increase. This marks the 30th consecutive month of wage growth. More importantly, with CPI rising 3.3% yoy in the same month, real wages increased by 1.1% yoy, marking the first gain in 27 months as wage growth finally outpaced inflation.
A Ministry of Health, Labor and Welfare official commented, “We will monitor incoming data closely to see if the trend has really changed as there is a possibility that those firms that paid bonuses in July might have just moved up the timing this year.”
Excluding bonuses and non-scheduled payments, average wages climbed 2.3% yoy, while overtime and other allowances rose by 1.3% yoy.
Also released, household spending in June fell by -1.4% yoy, worse than the expected -0.9% yoy decline, marking the second consecutive month of decline following a -1.8% drop yoy in May.
