Japan Wage Growth Projected to Outpace Inflation in FY ’25: Govt

Tokyo, Dec. 26 (Jiji Press)–The Japanese government said Thursday it expects wage growth in Japan to outpace the country’s consumer inflation in fiscal 2025, as in fiscal 2024.

In fiscal 2025, which starts next April, nominal wages are projected to increase 2.8 pct from the previous year, while the overall consumer price index, which includes fresh food prices, is forecast to rise 2.0 pct, showed an estimate presented by the government at the day’s meeting of its Council on Economic and Fiscal Policy.

In fiscal 2024, nominal wages and the overall CPI are estimated to go up 2.8 pct and 2.5 pct, respectively.

The pace of wage growth is expected to exceed that of inflation throughout fiscal 2024, and such a trend is projected to be firmly established in fiscal 2025, the Cabinet Office said.

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In line with higher wages, personal consumption is forecast to gradually increase in real terms on condition that the government continues to improve the environment for realizing wage hikes similar to those in fiscal 2024, the government agency said.

[Copyright The Jiji Press, Ltd.]