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Tokyo to nominate next Bank of Japan chief

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(Globalpost/GlobalPost)

Tokyo is set to name the next governor of the Bank of Japan and his two deputies on Thursday as the government ramps up its bid to breathe new life into the world's third-largest economy.

Prime Minister Shinzo Abe was widely expected to nominate Haruhiko Kuroda, head of the Asian Development Bank (ADB), for the top central banker post, asking parliament to greenlight his appointment over the coming weeks.

The job is a key post globally, the equivalent of US Federal Reserve Chairman Ben Bernanke or European Central Bank chief Mario Draghi.

The vacancy comes as Abe's administration has leaned on the central bank to further loosen its monetary policy and help realise a goal of stoking growth in Japan's deflation-plagued economy.

Abe sparred over policy matters with outgoing BoJ chief Masaaki Shirakawa who is stepping down on March 19, three weeks before the end of his term.

Japan's premier, who swept to power in December elections, warned Shirakawa that he could change a law guaranteeing the bank's independence if it did not follow his prescription of big spending and aggressive monetary easing.

Kuroda, a longtime critic of Japan's central bank, is known as an advocate of loosening the monetary reins in a bid to overcome slow growth, putting him squarely in Abe's policy camp.

He spent decades as a Japanese finance ministry bureaucrat and was responsible for international affairs and foreign exchange policy between 1999 and 2003. He assumed the top job at the Manila-based ADB in 2005.

Abe is also reportedly planning to nominate Tokyo's Gakushuin University economics professor Kikuo Iwata as one of the deputy governors, while BoJ executive director Hiroshi Nakaso was on track for the other deputy position.

On Tuesday, Fed chief Bernanke said his bank would stick to its loose monetary policy to help put the world's largest economy back on track.

Bank of England (BoE) Governor Mervyn King said this week that easing alone was no cure-all, although the BoE has also launched similar measures to prop up Britain's recession-hit economy.

Kuroda's expected appointment comes as Tokyo faces criticism that its monetary policy has pushed down the yen's value in recent months, fuelling accusations it was risking a global currency devaluation war as rival nations race to gain a trade advantage.

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http://www.globalpost.com/dispatch/news/afp/130227/tokyo-nominate-next-bank-japan-chief