Feeling richer under PM Abe yet?

Good morning everyone,

It's looking more and more like we can expect some rain on Wednesday, but until then it's going to be warm and sunny with daytime highs in the high 20s and overnight lows in the high teens.

Did you notice some things were a bit more expensive yesterday? Price hikes for a number of items went into effect from June 1st, among them beer (well, beer-like drinks), butter and postcards.

A revision to the Liquor Tax Law regarding regulations that enabled excessive sales of alcoholic beverages at a discounted price will be enforced at supermarkets and major retailers. The new law will require mass merchandisers to raise the cost of beer and “happoshu” (low-malt beer-like beverages) by about 10%.

Due to the rising price of raw materials, Meiji Holdings and Morinaga Milk Industry said they had to subsequently increase the cost of household butter by 5 yen for shipments starting yesterday. Other butter manufactures are expected to raise their prices, too.

Japan Post Co also raised the price of standard postcards by 10 yen. They are up from 52 yen to 62 yen.

Furthermore, due to the increased cost of importing liquefied natural gas (LNG), 10 major electricity companies and four major gas utilities have raised rates from between 20 yen and 65 yen. These increases are based on Japan’s fuel cost adjustment system that causes electricity and gas rates to fluctuate on a monthly basis.

And for those of you who are looking to get a mortgage or re-new your current one, be forewarned-banks are talking about raising interest rates on mortgages and loans in the near future...

Ok...so, prices are going up, but wages are too, right? Wrong! Here's some data from a Japanese business magazine...

In March 2017, basic and overtime wages, otherwise known as regular wages, fell by 0.2% year on year (YoY), the first fall since June 2016. Despite the ongoing tightening in the labor market, wages in Japan remain stubbornly flat. The growth in regular wages in Japan have hovered in the range of -0.6% to 0.7% since April 2013. A sustained acceleration in the wage inflation is a critical factor for Japan to attain its growth goal, but remains a pipe dream for PM Abe and the LDP.

In addition, Total wages also witnessed a fall by 0.4% YoY in March, the highest fall in wages since June 2015. The real wage growth, after offsetting the inflation in the consumer price, fell by 0.8% YoY in March. This mark the steepest decline in real wages since June 2015.

Do you feel richer? Not even close...I might have to raise my lesson fees to pay for my happoshu...Ha ha!

Have a great day!

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