A Bank of Japan Policy Board member raised doubts about the possibility of sharp wage increases in the country, given weak economic growth, the minutes of their meeting last month showed Friday.
“The rate of increase in wages could remain moderate owing to lackluster growth in aggregate demand in a situation where the economic growth rate had not been rising,” one of the nine members of the decision-making body said, according to the minutes of the Sept. 3-4 meeting.
The remark apparently sounds an alarm as the central bank keeps saying the employment and income situation has improved, supporting private consumption that was affected by the April consumption tax hike.
One member said, “The pace of improvement in the employment situation had slowed somewhat,” referring to jobs data released ahead of the policy meeting that showed the nation’s unemployment rate worsened for the second consecutive month to 3.8 percent in July.
“This could be attributable to the fact that exports and production had recently shown some weakness,” the member said.
Another member said the BOJ should “closely monitor whether the economy’s capacity to generate income would be maintained,” adding that “developments in employment and income lagged behind those in the economy in general.”
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