BOJ Rate Hike Odds Rise as Japanese Wages Climb to New Heights

Japan's wage growth remains firm, driven by solid corporate earnings and a tight labor market. Nominal wages climbed 3.4 percent in June from a year earlier, matching the median estimate of economists surveyed by Bloomberg.

This is the fifth consecutive month that nominal wages have exceeded 3 percent, the longest such streak in 34 years. Base pay also advanced 3.4 percent, while a more stable measure rose 2.9 percent for full-time workers.

Real wages gained 1.7 percent, marking a sixth straight month of increases, the longest streak since 2021.

The Bank of Japan may hike interest rates as early as September, or no later than December, as steady wage gains support this expectation.