Japanese Prime Minister Shinzo Abe nominated Asian Development Bank President Haruhiko Kuroda to lead the nation’s central bank, raising the likelihood of further monetary stimulus this year.
Kikuo Iwata, a professor at Tokyo’s Gakushuin University who advocates greater government oversight of the Bank of Japan (8301), and BOJ Executive Director Hiroshi Nakaso were nominated for the two deputy governor positions, the nation’s parliament said in a statement today. Current Governor Masaaki Shirakawa and his deputies will step down on March 19.
The regime change may tilt Japan’s central bank toward a more expansionary monetary policy as Abe calls for a 2 percent inflation target to be reached as soon as possible. The yen has fallen about 11 percent against the dollar in the last three months as investors assess the possibility of a shift in the BOJ’s stance, with JPMorgan Chase & Co. saying that the new leadership could implement more stimulus as early as April.
Kuroda, 68, advocated an inflation target more than a decade before the central bank adopted one in January, and said this month that additional easing can be justified for 2013.
The first policy meeting for the new leadership is scheduled for April 3-4, after Shirakawa’s last meeting as governor on March 6-7. The deputy governors leaving are Kiyohiko Nishimura and Hirohide Yamaguchi.
The yen held its losses after the nominations were announced. The currency was 0.2 percent lower at 11:08 a.m. in Tokyo, while the Nikkei 225 Stock Average was 1.8 percent higher.
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