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New BoJ chief Kuroda is advocate of monetary easing

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(Globalpost/GlobalPost)

Haruhiko Kuroda, confirmed Friday as the next Bank of Japan governor, is a finance veteran who has long pushed for the aggressive monetary easing demanded by Japan's new government to stoke growth.

The 68-year-old, who recently announced his decision to step down as the head of the Asian Development Bank (ADB), is known to be on close terms with key players in the world of global finance and central banking.

He spent decades in the Japanese finance ministry 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.

Kuroda has been a stern critic of the BoJ, and a vocal supporter of Prime Minister Shinzo Abe's call for aggressive easing and the setting of a two-percent inflation target, which the central bank adopted in January.

The next BoJ governor, who will officially take office on Wednesday, also defended Abe's use of monetary policy to weaken the yen to help Japan's exporters, criticised in Europe for risking a global currency devaluation war.

He hit out at the BoJ for not doing enough to tackle Japan's long-running deflation, which has hurt the world's third-largest economy as years of falling prices dampened private spending and business investment.

"There has never been a developed nation that has suffered deflation for 15 years -- it is abnormal," Kuroda was quoted as saying.

"The duty to stabilise prices rests with central banks," he added.

Kuroda, who graduated from the University of Tokyo and earned a master's degree from Oxford University, speaks fluent English and has the kind of management experience, including his stint at the ADB, that has won him the approval of Japan's business community.

Analysts have said Abe is hoping Kuroda's connections and English fluency will help him communicate Tokyo's economic stimulus plans overseas.

Kuroda's two deputy governors will be Kikuo Iwata, an economics professor at Tokyo's Gakushuin University, and Hiroshi Nakaso, the BoJ's executive director and a career central banker.

Iwata has long pushed for the BoJ to boost its easing efforts to turn around Japan's lumbering economy, and favours giving Tokyo more control over the central bank, a touchy subject at the independent BoJ.

Nakaso was directly involved in BoJ talks with other central banks in 2008, as they scrambled to contain the impact of the collapse of Wall Street titan Lehman Brothers.

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http://www.globalpost.com/dispatch/news/afp/130314/new-boj-chief-kuroda-advocate-monetary-easing