on Wednesday, heightening expectations that bumper pay raises will give the central bank leeway to make a key policy shift next week.
The annual talks, long a defining feature of the usually collaborative relationship between Japanese management and labour, are being closely watched this year as the pay increases are expected to help clear the way for the central bank to end its years-long policy of negative interest rates as early as next week.
“We’re seeing strong momentum for wage hikes,” Chief Cabinet Secretary Yoshimasa Hayashi told reporters. “It’s important that the strong wage hike momentum will spread to small and mid-sized firms.”Economists see substantial wage increases as a prerequisite for the Bank of Japan to declare that its long-held goals of sustainable wage growth and stable prices are in sight and usher in an end to negative rates in place since 2016.