Japan Approaches Amamiya for BOJ Governor, Nikkei Says

  • In Business
  • 2023-02-05 19:44:42Z
  • By Bloomberg

(Bloomberg) -- The Japanese government has approached Masayoshi Amamiya, the Bank of Japan's deputy governor, about succeeding Haruhiko Kuroda as head of the central bank, the Nikkei reported, citing unnamed sources. The yen fell following the report.

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Officials from the government and ruling coalition have held discussions with Amamiya, according to the Nikkei. The government is in the final stage of compiling the nomination plan, the report said. Nikkei said a BOJ official declined to comment, saying they were unaware of the discussions.

The yen weakened to as much as 132.48 versus the dollar, its softest level since Jan. 12, on the assumption the current ultra-easy monetary policy is more likely to endure if one of its architects succeeds Kuroda.

Prime Minister Fumio Kishida has said the nomination for central bank governor will come in February. The government will also name its nominees for two deputy governor positions.

The impending leadership change could usher in policy adjustments after years of full-bore stimulus. Speculation has simmered that such changes will accompany a new governor.

How the BOJ gets a new governor and why it matters: QuickTake

Kuroda is scheduled to step down as governor on April 8 after the longest stint running the central bank in its 140-year-old history. He's been instrumental in pushing one of the most ambitious monetary stimulus programs of modern times - and Amamiya has been a key figure in helping design BOJ policies.

The 67-year-old Amamiya and former Deputy Governor Hiroshi Nakaso have been seen by economists as front-runners for the post. If either of them get the post, it would return the position to a veteran central banker for the first time in a decade. Of the two, Nakaso is seen as slightly more hawkish on policy.

Read More: Nakaso's Bigger APEC Role Raises Question Over BOJ Prospects

Stocks may also move on the report and could get a boost as traders react to the likelihood of Amamiya's nomination. Market participants who have been pricing in an early withdrawal of stimulus could pull those bets if they expect a delay to any policy tweaks.

Choosing Amamiya would signal Kishida's desire both for continuity and an ability to respond to conditions with flexibility.

Deputy Chief Cabinet Secretary Seiji Kihara said Sunday that it was important to have stability in finance and macroeconomic policies. Speaking on public broadcaster NHK, Kishida's close aide stressed the need for stable and sustainable price growth.

--With assistance from Michael G. Wilson.

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