Kapok Macro: Japanese wages may maintain strong growth in the next year

Jinshi data on December 6th, Kaitou Macro said that Japan’s wage growth may have peaked, but it should remain strong next year. Preliminary data showed that the increase in base wages in October was the largest since 1992. However, it is worth noting that 8 out of 9 monthly forecasts have been lowered so far this year. The same situation may occur in October, indicating that wage rise has peaked. Although the bonus distribution in October did not play a driving role, it should accelerate during the winter bonus distribution season. Therefore, in the remaining time of 2024, cash income should increase. Due to the spring wage negotiation next year, it may bring a similar salary increase as this year. By 2025, both regular and overall cash income will remain at a strong level slightly below 3%.