Labour cash earnings expanded at the fastest pace since 1997 in July. Given recent, much slower, gains in productivity and the low likelihood of significant further tightening in the labour market, we expect wage growth to slow again as the summer bonus season draws to an end. Our analysis suggests that earnings growth will settle at around 1% y/y – too slow to drive inflation to the BoJ’s 2% target.
Become a client to read more
This is premium content that requires an active Capital Economics subscription to view.
Already have an account?
You may already have access to this premium content as part of a paid subscription.
Sign in to read the content in full or get details of how you can access it
Register for free
Sign up for a free account to:
- Unlock additional content
- Register for Capital Economics events
- Receive email updates and economist-curated newsletters
- Request a free trial of our services