Asian Markets Mixed as Fed Rate Cut Bets Grow and Japan’s Nikkei Leads Gains 
Dollar Slips as Weak U.S. Manufacturing Data Increases Pressure for Fed Rate Cuts 
U.S. May Withhold $30.4 Million From Minnesota Over Improper Commercial Driver Licenses 
South Korea Posts Stronger-Than-Expected 1.3% Economic Growth in Q3 
Gold Prices Steady as Markets Await Key U.S. Data and Expected Fed Rate Cut 
Oil Prices Rise as Ukraine Targets Russian Energy Infrastructure 
RBA Signals Possible Rate Implications as Inflation Proves More Persistent 
South Korea Inflation Edges Up in November as Food and Service Costs Climb 
Japan’s Service Sector Sustains Growth Momentum in November 
Oil Prices Rise as Geopolitical Tensions and Supply Risks Intensify 
Dollar Holds Steady as Markets Shift Focus to 2026 Rate Cut Expectations 
Trump and Lula Discuss Trade, Sanctions, and Security in “Productive” Phone Call 
China’s Services Sector Posts Slowest Growth in Five Months as Demand Softens 
IMF Deputy Dan Katz Visits China as Key Economic Review Nears 
U.S. Soybean Shipments to China Gain Momentum as Trade Tensions Ease 
Dollar Slides to Five-Week Low as Asian Stocks Struggle and Markets Bet on Fed Rate Cut 
Japan’s early outlook for next year’s annual wage negotiations suggests another round of strong pay increases, even as U.S. tariffs squeeze corporate profits. This momentum strengthens expectations that the Bank of Japan (BOJ) may continue raising interest rates as it monitors wage and inflation trends. BOJ Governor Kazuo Ueda recently emphasized the need for “a bit more data” on wage talks, particularly from industries heavily affected by U.S. levies.
Labour unions are preparing to push aggressively for sizable pay hikes once again. Rengo, Japan’s largest labour federation representing seven million workers, plans to demand wage increases of at least 5% in 2026, mirroring the target that led to the biggest pay raise in 34 years during 2025 negotiations. Automaker unions—among the most impacted by U.S. tariffs—also intend to maintain robust wage demands despite profit headwinds.
Japan’s wage negotiation cycle typically begins with unions drafting demands in late autumn, followed by formal talks early the next year and final agreements by March. While rising U.S. tariffs may lead some companies to resist union proposals, manufacturing sentiment remains solid. A recent Reuters poll shows confidence hitting its highest level in nearly four years, supported by yen weakness and steady orders.
Additionally, Japan’s tight labour market continues to pressure companies to raise pay. Another Reuters survey revealed that 72% of firms plan to lift wages in 2026 at a pace similar to 2025. Labour shortages are especially severe in hospitality; Watami, for example, will implement multi-year pay increases averaging 7% annually from 2026 for its full-time staff.
Economists expect average pay hikes to remain near or above the 5% threshold. Forecasts from the Japan Center for Economic Research point to an average 4.88% increase next year, while Dai-ichi Life Research Institute anticipates around 5.2%.
Prime Minister Sanae Takaichi’s administration is also pushing for wage growth that outpaces inflation, adding political pressure on companies. Keidanren, Japan’s influential business lobby, is reportedly preparing guidance urging firms to maintain strong wage momentum.
More clarity on BOJ policy may come on December 1, when Ueda addresses business leaders in Nagoya. A slight majority of economists now expect a rate hike by December, supported by a weakening yen and firm wage expectations.
