Japan’s March real wages fell at the fastest pace in almost two years, pressured by meager nominal pay hikes and a slight rise in consumer prices, posing a setback for Prime Minister Shinzo Abe’s attempts to revitalize the economy.
The wages figures back recent data showing household spending fell more than expected and core consumer prices rose at a slower-than-expected pace in March, suggesting an exit from the central bank’s radical quantitative easing program remains distant.
Inflation-adjusted real wages dropped 0.8 percent in March from a year earlier to mark their biggest rate of decline since June 2015, labor ministry data showed on Tuesday.
In nominal terms, wage earners’ cash earnings fell 0.4 percent year-on-year in March, also notching the biggest rate of decrease since June 2015.
