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BOJ gets a glimpse of wage-price pressures

The strongest increase in regular wages in 25 years is an early sign that the virtuous cycle between prices and wages that the Bank of Japan would like to see is starting to materialise. But with inflation set to drop back next year and profit margins coming under pressure from weaker external demand and a renewed strengthening of the yen, we don't expect wage growth to reach the lofty heights the Bank considers necessary to sustain inflation at target. 

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