Japan will raise its minimum hourly wage by a record 6.3% to ¥1,121 ($7.56), reinforcing the nation’s wage-price cycle and supporting the case for the Bank of Japan to keep hiking rates.
Prefectures nationwide will boost minimum pay by an average of ¥66 an hour in the current fiscal year, the labor ministry said Friday. The increase marks the largest since records began in 1978. The new wage level, which applies to about 3 million workers, will gradually take effect from October.
The hike will likely fuel more price gains, as employers pass on rising costs to consumers. It would also give workers more money to spend, helping to reinforce a cycle of demand-led price gains long sought by the BOJ.
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