TOKYO- Bank of Japan Governor Haruhiko Kuroda on Monday defended his decade-long stimulus program, saying there was “no better way” to aim at sustainably achieving its 2 percent inflation target.
“With our monetary easing steps, we sought to stimulate economic activity and tighten the labor market so that prices and wages would rise more,” Kuroda told parliament.
“This was a necessary approach and one that is shared by other central banks,” he said.
Meanwhile, Japan’s government has sounded out Bank of Japan (BOJ) Deputy Governor Masayoshi Amamiya to succeed Kuroda as central bank governor, the Nikkei newspaper reported early on Monday, citing anonymous government and ruling party sources.
The next BOJ chief will face the delicate task of normalizing ultra-loose monetary policy, which is drawing increasing public criticism for distorting market function.
A career central banker who has drafted many of the BOJ’s monetary easing tools, Amamiya has been seen by markets as a top contender to take over as next governor.
Prime Minister Fumio Kishida’s administration is in the final stages of deciding on successors to Kuroda and two deputy governors and is in discussions with the ruling coalition about the process, the Nikkei said.
The government’s nominations will be presented to parliament later this month and take effect upon both houses granting approval, which is effectively a done deal since the ruling coalition has a solid majority.
The Nikkei report did not say whether Amamiya had accepted the offer. When asked about the Nikkei report, Finance Minister Shunichi Suzuki told reporters he had not heard that the government had offered Amamiya the job.
Jiji news agency said Amamiya had not commented to reporters when asked whether he had been sounded out about becoming BOJ governor.
In a news conference on Monday, Deputy Chief Cabinet Secretary Yoshihiko Isozaki said there was no truth to the report the government had sounded out Amamiya for the top BOJ job.
Kishida’s choice of a successor to Kuroda, whose five-year term will end on April 8, will likely affect how soon the central bank could phase out its massive stimulus. Inflation hit 4 percent in December, double the BOJ’s 2 percent target.
The dollar was last up 0.6 percent at 131.97 yen, following Isozaki’s comments. It rose as high as 132.60 yen after the Nikkei report, trading above the 132-level for the first time since Jan. 12, as Amamiya is seen by markets as more dovish than other contenders for the post. – Reuters
