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BOJ's Kuroda barely raises wages despite stressing need for higher wages

TOKYO (Reuters) – Bank of Japan Governor Haruhiko Kuroda will get a minimal pay rise of 0.4%, after two years of pay cuts, he said on Friday, underscoring the need for higher wages. To continue to meet the central bank’s inflation target.

The 0.4% pay rise for the fiscal year ending March 2022 will apply to BOJ executives, including Haruhiko Kuroda and his board members. In a statement announcing the annual salary adjustment, the BOJ said it would consist entirely of administrative allowances, with no monthly salary increase. Severe deflation or low inflation, which makes salary increases difficult.

Recently, however, rising raw material costs and a weak yen have led to a surge in import prices that has pushed up inflation, hurting many households

Core consumer prices in the Japanese capital are A leading indicator of national trends rose 3.6 percent in November from a year earlier, marking a year, data showed on Friday.

Haruhiko Kuroda has repeatedly called on businesses to raise wages next year and beyond, ideally around 3% per year, to compensate for the rising cost of living for households and contribute to a sustainable economy for Japan. Paves way to meet the central bank’s 2% inflation target.

Private nominal wages have been climbing this year after rising just 0.3% last year, rising 2.2% year-on-year in September, according to a revised 2.2% increase, according to government data. This is partly due to labor shortages exacerbating the data.

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