BoJ’s latest Regional Economic Report noted that all nine regions have experienced an uptick in their economies, albeit with variations in pace and extent. This improvement is happening despite challenges posed by the global economic slowdown and domestic price increases. The report categorizes the regional economies as either picking up, recovering moderately, or steadily improving.
Notably, Tokai and Kyushu-Okinawa regions received upgrades in their economic assessments. Kinki region, on the other hand, was downgraded, noted for showing “some weakness in part.”
Regarding wages, BoJ report highlights a divergence in approaches among firms. It acknowledges that “some big firms have already announced plans to hike wages this year at or above the pace of last year,” suggesting a proactive response to inflation and economic recovery.
However, the situation is not uniform across all business sizes. The report points out that “many firms have yet to firm up their plans on the pace of wage hikes.” This uncertainty is particularly pronounced among small and medium-sized enterprises, which remain cautious about increasing wages due to profit constraints.
