Japan wages are seen ascending 2%-2.5% in spring

Japan wages are seen ascending 2%-2.5% in spring

Japanese wages are expected to soar by 2%-2.5% at next spring's annual talks, falling short of Prime Minister Shinzo Abe's objective of 3%, as market experts surveyed by Reuters forecast.

Abe's government is actually considering tax incentives as well as other means to encourage Japanese companies to have wages lifted by 35, hoping customers will spend more, thus accelerating Japan's stubbornly low inflation.

This year, key Japanese companies, negotiating with labor unions every spring for the purpose of agreeing on a wage lift, increased wages an average 1.98%, according to Rengo, the country’s number one labor federation.

Japanese companies are actually sitting on piles of money from firm earnings, although they’re reluctant to lift fixed costs, including wages. It’s because they’re worried about Japan's decreasing population.

They’re also eager to have a huge cash buffer at hand in case of an international political or financial downtime.

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