The Japanese yen strengthened past 154 per dollar on Thursday, recovering from the previous session’s losses as steady wage growth reinforced expectations that the Bank of Japan will stay on its tightening path. Nominal wages rose 1.9% in September, up from a 1.5% gain in August, supported by stable base pay and a modest rise in overtime income. Still, wage growth lagged behind the 3.4% increase in consumer prices, resulting in a 1.4% drop in real wages and marking the ninth consecutive monthly decline. BOJ Governor Kazuo Ueda said the 2026 wage outlook will be key in deciding when to resume tightening after the central bank left policy unchanged last week. Meanwhile, new Prime Minister Sanae Takaichi reiterated that Japan has yet to see sustainable inflation driven by strong wage gains, signaling her administration’s cautious stance toward further rate hikes.
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