Bank of Japan Governor Ueda:
- US tariffs will likely affect Japan’s economy through various channels but it will probably first come via export firms
- If US tariffs hurt exporters’ profits, that could have broader impact on households, firms such as by souring consumer sentiment
- Japan’s real wages are negative, aware that is having big impact on consumption, economy
- Impact of US tariffs on Japan’s economy could have ‘somewhat negative effect’ on firms’ winter bonus payments and next year’s wage negotiations
- Wage growth may slow somewhat due to tariff impact, but likely to re-accelerate thereafter
- Consumption likely to maintain moderate uptrend as real wages gradually improve
The implications of what Ueda has been saying today are not encouraging for an imminent BoJ rate hike
More from Ueda: Japan’s real wages are negative, wage growth may slow then rebound
