TOKYO, Jan 24 Reuters Japan39;s biggest business lobby Keidanren and trade unions kicked off annual labour talks on Wednesday that may pave the way for the central bank to exit its decadelong superloose monetary policy.

The talks come a day after the Bank of Japan BOJ took a hawkish turn in policy even as it maintained its accommodative monetary settings, with markets increasingly betting on a shift towards normalising rates in March or April.

Japan39;s big firms are expected to offer their unions wage hikes of 3.85 on average this year, the highest wage increase in 31 years, according to a poll of 37 economists conducted Dec. 25Jan. 9 by Japan Centre for Economic Research, a private think tank.

The 3.85 estimate beat last year39;s threedecade high of 3.6, the biggest gain since Japan39;s asset bubble burst in the early 1990s. An agreement for a 3.85 hike would mark the fastest growth in annual pay since 1993 when wages grew 3.89.

This year, we are aiming for wage hikes that beat inflation in order to achieve structural wage hikes, Keidanren chief Masakazu Tokura said in a video message, underscoring the importance of improving labour productivity through sustainable wage hikes.

Tokura stopped short of specifying target pay hike levels.

Since last year, a number of major firms had already announced their intention of delivering large pay hikes, though struggling smaller firms have lagged behind.

Small firms that employ seven out of 10 workers hold the key to wage…