BOJ to give meagre pay rise in 2022

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BOJ to give meagre pay rise in 2022

After two years of cuts, the central bank said on Friday that the central bank will give a meagre 0.4% pay rise in 2022 to TOKYO Reuters-Japanese Governor Haruhiko Kuroda, even as he stressed the need for higher wages to meet the central bank's inflation target.

The pay rise for the current fiscal year ending March 2023 will apply to BOJ executives, including Kuroda and his fellow board members. The BOJ said the annual pay revision will consist entirely of executive allowances with no increases to monthly salaries.

It is hard to justify increasing pay because of the decision to drive up wages in a country accustomed to decades of deflation or low inflation.

As the rising raw material costs and rising import prices from the weak yen have pushed up inflation, hurting many households that have yet to see wages rise.

Consumer prices in Japan's capital, a leading indicator of nationwide trends, rose by 3.6% in November from a year earlier in the year to the fastest pace in 40 years, data showed on Friday.

Kuroda has repeatedly called for companies to boost wages next year and beyond, preferably by around 3% annually, to compensate households for the rising cost of living and to make Japan more resilient to the central bank's 2% inflation target.

Private nominal wages have gone up this year and increased by a revised 2.2% from a year earlier in the year due to the intensifying labour shortages, according to government data.