Japan’s Base Salary Jumps to Highest Level in 28 Years as Markets Eye BOJ’s Policy Shift

The government data on Friday showed that Japan’s base salary rose at the fastest pace in 28 years in May, adding hopes that the central bank will finally step out of its ultra-loose monetary stimulus.

Regular wages rose 1.8% in May from last year, according to the data released on Friday, which was the biggest gain since February 1995.

The market has been watching Japan’s wage data closely after the Bank of Japan Governor Kazuo Ueda said that pay growth will be a key gauge for the central bank to consider a shift in policy.

Earlier, Japan’s largest labor organization Rengo noted that major companies had agreed to raise salaries by an average of 3.58% this year, the highest since 3.9% in 1993.