Japan will increase its minimum hourly wage by 6.3% to a record high of 1,121 yen (approximately $7.56), strengthening the country's wage-price cycle and providing support for the Bank of Japan's continued interest rate hikes.

The Ministry of Health, Labour and Welfare announced on Friday that prefectures across the nation will raise minimum wages by an average of 66 yen per hour during this fiscal year. This represents the largest increase since records began in 1978. The new wage standards, which will apply to approximately 3 million workers, will take effect gradually starting in October.