USD/JPY flows: Labor Cash Earning Growth Slows

The March Japan labor cash earning continues to grow above 2% at 2.1% y/y but has slowed from the previous sub 3% level. While it is before the 2025 spring wage negotiation, the uncertainty from potential tariffs may have deterred the pace of wage hike in Japan. On the other hand, we have a recovery in household spending to 2.1% y/y, suggesting consumption is set to further recover.

USD/JPY is trading little changed at 145.85.