USD/JPY: December BoJ Rate Hike Unlikely as Japan Wages Contract Again

USD/JPY maintains bullish momentum near 153.70 as fresh Japanese wage data diminishes prospects for a Bank of Japan rate hike in December. Real wages in Japan contracted for the second consecutive month, falling 0.3% year-over-year in September, undermining the BoJ's case for policy tightening. The persistent wage weakness challenges Governor Ueda's narrative that sustainable inflation requires robust income growth. Markets have reduced the probability of a December hike to just 25%, down from 40% last week. The yen's weakness continues to benefit USD/JPY, with the pair up 2.1% over the past month. Technical resistance stands at 154.50, while support has formed at 152.80. The wage data suggests the BoJ may delay further tightening until early 2025, keeping the yen under pressure. Traders should monitor upcoming BoJ minutes and Japanese CPI data for additional policy clues.