Wages in Japan need to rise for Abenomics to work, says IMF

Tokyo

ABENOMICS needs a "fourth arrow" - an official policy to boost wages - that will work in tandem with other stimulus policies being implemented under the original three arrows, the International Monetary Fund (IMF) said on Monday.

"Wages need to grow if Japan is to make a definite escape from deflation," the IMF said in a blog which suggested that wage negotiations in the world's third-largest economy need to become more "aggressive".

The call followed the weekend's annual convention of the ruling Liberal Democratic Party where Prime Minister Shinzo Abe defended Abenomics and claimed that "…