Japan to Nominate Ueda to Lead Bank of Japan
By TOKYO—The Japanese government is planning to nominate former Bank of Japan Policy Board member Kazuo Ueda, an economist and advocate of aggressive monetary easing, to lead the Bank of Japan (BOJ) as its next governor, succeeding incumbent Haruhiko Kuroda.
Prime Minister Fumio Kishida will officially nominate Ueda, along with BOJ Executive Director Shinichi Uchida and former chief of the Financial Services Agency Ryozo Himino as deputy governors, according to Nikkei. The House of Representatives and the House of Councillors must both give their approval in order for the government to officially appoint a new governor and two deputy governors, who will serve five-year terms.[0]
Ueda, a professor at Kyoritsu Women's University, would be the first candidate from the academia to become the BoJ Governor in postwar Japan, Kyodo news service said.[1] A monetary policy expert aged 71 was a board member of the Bank of Japan from 1998 to 2005.[1] His appointment comes at a difficult juncture for financial markets as the US disinflationary trend comes into question, and the BoJ and Japanese markets will be hoping for a soft US CPI print next week or upward pressure on yields globally will likely resume, including in Japan.[1]
In contrast to the U.S. Federal Reserve and the European Central Bank, which have been raising interest rates in order to curb high inflation, the Bank of Japan has taken an aggressive stance on monetary easing.[2] It is expected that signs of a significant change in policy will cause the yen to appreciate, making it difficult for those who rely on trends to trade in this market.[3]
Former BoJ Deputy Governor Hiroshi Nakaso; Hirohide Yamaguchi, also a former deputy governor; and Masayoshi Amamiya, who is seen as one of the architects of the BoJ’s loose monetary policy, have been considered as possible candidates for the position.[4]
A report by the Nikkei that the Japanese Government had approached Deputy Bank of Japan (BoJ) Governor Masayoshi Amamiya as a potential successor to Governor Kuroda caused the Yen to be under pressure during the Asian session.[5] Amamiya is widely regarded as an instrumental figure in the Bank of Japan's expansive monetary policy, which has been demonstrated by the depreciation of the Yen.[6]
0. “Ex-BOJ policymaker Ueda eyed as next governor in surprise pick” Kyodo News Plus, 10 Feb. 2023, https://english.kyodonews.net/news/2023/02/af6583a5beeb-new-bank-of-japan-chief-nominee-to-be-presented-to-parliament-tues.html
1. “Kazuo Ueda Nomination As BoJ Chief A Harbinger Of Policy Shift” RTTNews, 10 Feb. 2023, https://www.rttnews.com/3343504/kazuo-ueda-nomination-as-boj-chief-a-harbinger-of-policy-shift.aspx
2. “Bank of Japan chief nominee to be presented to Diet on Tuesday” Nikkei Asia, 10 Feb. 2023, https://asia.nikkei.com/Economy/Bank-of-Japan/Bank-of-Japan-chief-nominee-to-be-presented-to-Diet-on-Tuesday
3. “USD/JPY Price Outlook: Japan’s PM Reveals Prerequisite for New BoJ Head” DailyFX, 8 Feb. 2023, https://www.dailyfx.com/news/forex-usd-jpy-price-outlook-japan-s-pm-reveals-prerequisite-for-new-boj-head-20230208.html
4. “Japanese yen jumps on report Kazuo Ueda will be next governor of the central bank” CNBC, 10 Feb. 2023, https://www.cnbc.com/2023/02/10/japanese-yen-jumps-on-report-kazuo-ueda-will-be-next-governor-of-the-central-bank.html
5. “Japan sounds out BOJ deputy Amamiya for central bank governor” Nikkei Asia, 5 Feb. 2023, https://asia.nikkei.com/Economy/Bank-of-Japan/Japan-sounds-out-BOJ-deputy-Amamiya-for-central-bank-governor
6. “USD/JPY Hits Fresh 3-Week High on Speculation of New BoJ Governor” DailyFX, 6 Feb. 2023, https://www.dailyfx.com/news/forex-usd-jpy-hits-fresh-3-week-high-on-speculation-of-new-boj-governor-20230206.html
