Japan’s government is considering tax breaks for firms that grant 8% wage increases.
That’s the chatter doing the rounds, fuelled by a report in Japanese media (Yomiuri).
The Japanese government want to incentivise pay increases as part of the battle to lock in sustainable and stable inflation.
If there is widespread adoption of such pay increases it’ll provide cover for the Bank of Japan to argue it can trim back on easy monetary policy, and is thus yen supportive.
Some of this chatter may have been a catalyst for this overnight:
Bank of Japan Governor Ueda
This article was written by Eamonn Sheridan at www.forexlive.com. Source