Suggests BOJ wait and see if wage hikes may continue
3 rise in nominal pay needed in efforts to meet 2 inflation
Real wages must turn positive to stimulate consumer spending

TOKYO, Oct 12 Reuters Japan must focus on improving wage growth to pave the way for sustainable inflation, Bank of Japan board member Asahi Noguchi said on Thursday, signalling that the central bank must retain its monetary easing policy for the time being.

Noguchi, known for his reflationist views, made the remarks in a speech to business leaders in Niigata, north of Tokyo, calling the more than 3 wage hike rise agreed upon earlier this year, the highest in 30 years, as significant.

The biggest focus now is whether this wage growth momentum will be maintained or not from now on as well, he said. The BOJ39;s mission for the time being is to realise it through patient monetary easing.

Analysts said his comments were neither dovish nor hawkish.

Noguchi followed the consensus view among the board members, said Yoshimasa Maruyama, chief market economist at SMBC Nikko Securities.

His emphasis on wage growth probably meant the BOJ will retain its easy policy until wage hikes are firmly in place following the labour talks next March.

Japan39;s wage trends, which have been largely flat over the past three decades since the assetbubble burst, are closely watched by global financial markets as the BOJ has emphasised that sustainable pay hikes is a prerequisite for dismantling its massive monetary…