JPY Surges on Upbeat Wage Data and BoJ Hike Bets

The Japanese Yen has surged to its highest level in nearly two months, reaching February 18 highs, due to upbeat wage data and GDP numbers that have bolstered bets for a Bank of Japan interest rate hike.

Japan's real wages climbed 2.4% in July from a year earlier, marking the biggest increase since May 2021, while the inflation rate used by the labour ministry to calculate the real wages moved above 2% for the first time this year.

The revised data released by the Cabinet Office revealed that Japan's economy expanded at an annualized rate of 1.4% during the April, June period, revised up from the preliminary estimate of 1.1%, further supporting the case for a BoJ rate hike next week and continued tightening thereafter.