Forex – Inflation-adjusted prices in Japan rose in July after June, with the contribution of bonus payments by some companies in the summer months.
According to data from the Japanese Labor Ministry, real prices rose 0.4 percent in July. The change in real prices rose 1.1 percent in June, turning positive for the first time in 27 months,
A labor ministry official said the slowdown in real price growth in July was mainly due to fewer firms paying bonuses than in June. Special payments, which include bonuses, rose 6.2% in July, following a revised 7.8% increase the previous month. The official said the contribution of special payments to raising real prices would disappear after August, as many firms paid summer bonuses in June and July. “In August and beyond, monthly prices (consisting of regular and overtime payments) will be a decisive factor in anchoring growth in real prices,” he said.
Nominal prices, or average total cash output per worker, rose 3.6% to 403,490 yen ($2,785.19), up 2.7% from 4.5% in June, the fastest month since January 1997.
The base rate, or regular pay, rose 2.7%, the fastest rate of increase in nearly 32 years, reflecting the results of labor-management wage negotiations this spring.
Overtime wages, a barometer of companies’ strength, fell 0.1% in July following a revised 0.9% increase in June.
