Korea – wage growth still slowing, floor should be close

The breakdown of income in the detailed Q2 GDP data shows the labour share falling, but remaining well above the pre-covid level. That implies wage growth has slowed to a bit over 2%. Bottom-up wage data for June look similar. A floor is probably close, but there's no sign of a re-acceleration yet.

Paul Cavey

Sep 3, 2025 • 2 min read

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East Asia Today

Today, top-down and bottom-up data in Korea show wage growth still slowing; the August S&P services PMI in China rose, but also reported continued pricing pressure; and the services PMI in Japan remained firm, which continues the narrative of a cycle led more by domestic than external developments.

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East Asia Today

The only major data release today was August inflation in Korea. The headlines moved a lot, but the underlying picture was stable. In Japan, BOJ deputy governor Himino gave an interesting speech. In China, a reminder of the drivers of deflation and how they might be changing.

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Japan – Himino's upside and downside risks

The content of deputy governor Himino's speech today was thoughtful and so interesting, covering both tariffs and the outlook for prices. But consistent with the ponderous tone, the conclusions weren't particularly forceful.