Aurelia Butler

(Reuters) – Japan’s government is intensifying its search for a successor to central bank governor Haruhiko Kuroda, a choice that will affect how soon the Bank of Japan (BOJ) could phase out ultra-loose monetary policy.The Nikkei newspaper reported the government has sounded out BOJ Deputy Governor Masayoshi Amamiya as the next governor, citing anonymous government and ruling party sources.The government will present a nominee for BOJ governor, and that for two deputy governors, to parliament later this month. Approval by both houses is considered a near certainty due to the ruling coalition’s solid majority.Kuroda’s term ends on April 8, while those of deputy governors Amamiya and Masazumi Wakatabe expire on March 19.Below are possible candidates for the posts:MASAYOSHI AMAMIYA – VERY STRONG CONTENDER FOR GOVERNORCurrently deputy governor, Amamiya has spent most of his career at the central bank drafting monetary policy ideas and is nick-named “Mr. BOJ” for masterminding many of the bank’s unconventional monetary easing ideas.He played a key role in drafting Kuroda’s huge asset-buying programme in 2013 and consistently called for keeping ultra-low interest rates. But he also said in July the BOJ must “always” think about the means of exiting ultra-loose monetary policy.Many market players see a choice of Amamiya as governor as heightening the chance the BOJ will maintain the status quo for the time being and phase out Kuroda’s legacy stimulus only gradually.An avid fan of classical music, Amamiya is known for his deep contacts with lawmakers and bureaucrats that help him read which way the political wind is blowing in steering policy.HIROSHI NAKASO – POSSIBLE CONTENDER FOR GOVERNORA career central banker who served as deputy governor until 2018, Nakaso played a key role in navigating an exit from the BOJ’s first spell of quantitative easing in 2006.With long experience overseeing the BOJ’s market operations and international affairs, Nakaso has repeatedly warned of the drawbacks of prolonged monetary easing such as the distortion its huge presence could create in bond and money markets.Nakaso laid out his idea of an exit from ultra-easy policy in a book published in May. Under that plan, the BOJ would first ditch its 10-year bond yield target, then raise short-term interest rates and finally move to reduce its balance sheet.Some market players see Nakaso as having dropped out of the BOJ race, after he said last week he has taken up a post heading an Asia-Pacific Economic Cooperation (APEC) advisory council.HIROHIDE YAMAGUCHI – POSSIBLE CONTENDER FOR GOVERNORA career central banker, Yamaguchi served as one of the two deputies of former BOJ Governor Masaaki Shirakawa and played a key role in crafting an asset-buying scheme under which the bank first began purchasing exchange-traded funds (ETF) in 2010.Since retiring from the BOJ in 2013, he has criticised Kuroda’s stimulus as relying too much on the view central banks can influence public perceptions with monetary policy.Warning of the rising cost of prolonged easing, Yamaguchi has also called for ending the BOJ’s huge asset purchases and abandoning an yield cap he describes as unsustainable.TAKEO HOSHI – POSSIBLE DEPUTY GOVERNORAn economics professor at the University of Tokyo, Hoshi is well-versed in Japanese monetary policy and is a regular member of government panels and the BOJ’s academic workshops.At one of the BOJ workshops held in November, Hoshi explained how structural changes in Japan’s labour market could push up average wages more than in the past.”The BOJ must start worrying about the possibility of inflation accelerating more than expected,” he told Reuters, adding the BOJ may abandon its yield cap as early as this year.FEMALE DEPUTY GOVERNOR CANDIDATESNo female has yet served as BOJ deputy governor or governor, a tradition Kishida may seek to change to enhance diversity.One possible candidate is Tokiko Shimizu, who rose up the ranks in the male-dominated institution and now serves as executive director overseeing international affairs. People close to her describe Shimizu as dovish on monetary policy.Other candidates include think tank head Yuri Okina, who calls for phasing out the BOJ’s yield cap, and former BOJ board member Sayuri Shirai, who proposes a review of the current stimulus so the bank can adjust interest rates more flexibly.FINANCIAL BUREAUCRAT DEPUTY GOVERNOR CANDIDATESIf a former BOJ executive becomes governor, there is a strong chance one of the deputy governor posts will be filled by top finance ministry bureaucrats such as Shigeaki Okamoto and Yasushi Kinoshita.Kinoshita told Reuters the BOJ should eventually head for an exit from ultra-loose policy, and in doing so must move “cautiously and steadily” to avoid causing huge market turbulence.Ryozo Himino, a former head of Japan’s financial watchdog, is also considered a dark horse candidate. People close to him describe Himino as critical of the BOJ’s negative rates policy for the damage it is inflicting on commercial banks’ profits. More

TOKYO (Reuters) -Japan’s government has sounded out Bank of Japan (BOJ) Deputy Governor Masayoshi Amamiya to succeed incumbent Haruhiko 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 normalising 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 Kuroda’s successor along with two new deputy governors, and is in discussions with the ruling coalition about the process, the Nikkei saidThe government’s nominees will be presented to parliament later this month and take effect upon approval by both houses of parliament, which is effectively a done deal due to the ruling coalition’s solid majority in Japan’s national legislature known as the Diet.The Nikkei report did not say whether Amamiya accepted the offer.When asked about the Nikkei report, Finance Minister Shunichi Suzuki told reporters he had not heard that the government offered Amamiya the job. The prime minister’s office and the BOJ were not immediately available to comment.Jiji news agency said Amamiya did not comment to reporters, when asked whether he has been sounded out about becoming BOJ governor.Kishida’s choice of a successor to Kuroda, whose five-year term ends on April 8, will likely affect how soon the central bank could phase out its massive stimulus as inflation hit 4% in December, double its 2% target.The dollar was last up 0.5% at 131.85 yen, following the Nikkei report. Earlier, it rose as high as 132.60 yen as Amamiya is seen by markets as more dovish than other contenders for the post, reaching above the 132-level for the first time in more than three weeks.If Amamiya becomes governor, it would frustrate investors long on the yen and hoping for someone more hawkish, such as former deputy governor Hirohide Yamaguchi, to get the job, said Chris Weston, head of research at Pepperstone.”Amamiya, if accepts, will have full reign on policy changes and the idea of policy continuation is true here,” he said, adding that investors whose base case was for the BOJ to tweak its yield control policy in late April would now be reviewing that call.Amamiya played a key role in drafting Kuroda’s asset-buying programme in 2013 and consistently called for keeping ultra-low interest rates. But he also said in July the BOJ must “always” think about the means of exiting ultra-loose monetary policy.Amamiya and Masazumi Wakatabe are currently serving as deputy governors, but their five-year terms end on March 19. More

TOKYO (Reuters) – Japan’s government is intensifying its search for a successor to central bank governor Haruhiko Kuroda, a choice that will affect how soon the Bank of Japan (BOJ) could phase out ultra-loose monetary policy.The Nikkei newspaper reported on Monday the government has sounded out BOJ Deputy Governor Masayoshi Amamiya as the next governor, citing anonymous government and ruling party sources.Kuroda’s second five-year term ends in April. Below are key dates to watch:BOJ LEADERSHIP RACEPrime Minister Fumio Kishida will hand-pick nominees for the governor and deputy governor posts from a list crafted by his close aides and finance ministry officials.The government is expected to present the nominees to parliament next week, sources have told Reuters, which is most likely to be approved as the ruling coalition holds a majority in both houses of parliament.The nominees will then appear in both houses of parliament to testify their views on monetary policy.Kuroda’s term ends on April 8, while those of his deputies Masayoshi Amamiya and Masazumi Wakatabe expire on March 19.There is a slim chance Kuroda might step down early from his post, so that the new governor can assume the post together with the new deputies on March 20.People seen as top candidates for the BOJ governor post include Amamiya, as well as former deputy governors Hiroshi Nakaso and Hirohide Yamaguchi.BOJ RATE-SETTING MEETINGSThe final policy-setting meeting for Kuroda and his two deputies will be held on March 9-10.The subsequent meeting will be held on April 27-28 under a new BOJ leadership. At the April meeting, the BOJ will issue for the first time its quarterly growth and inflation projections for fiscal 2025, which will offer clues on how quickly the central bank could move toward an exit from ultra-easy policy.By the time the BOJ holds its April meeting, big firms would have agreed with unions on next year’s annual pay in “shunto” spring wage negotiations.OTHER KEY EVENTSJapan’s economic and inflation data will remain in the spotlight as the BOJ gauges the timing of an interest rate hike.Core consumer inflation hit 4.0% in December, double the BOJ’s price target, as companies hike prices to pass on higher raw material costs to households. Analysts expect it to stay above the BOJ’s 2% target for several more months, before slowing due to recent declines in global commodity costs.Consumer inflation data for February is due out on March 18.In a positive sign for policymakers, data due out on Feb. 14 will likely show Japan’s economy returned to growth in the last quarter of 2022 as consumption made a delayed recovery from the COVID-19 pandemic’s wounds.The new BOJ governor will be busy with international meetings. The first major one involving travel will likely to be the spring International Monetary Fund (IMF) meetings to be held in Washington D.C. on April 10-16.Japan will also chair this year’s Group of Seven (G7) meeting of advanced economies, where inflation and monetary policy will likely be among key topics of debate. More

“We can build a green bridge across the Atlantic and build joint green … markets,” the German economy ministry on Sunday quoted Habeck saying, in an itinerary of the planned meetings also involving his French counterpart Bruno Le Maire.Reuters on Saturday quoted French officials as saying Habeck and Le Maire would use the meetings to press senior U.S. officials not to try to actively poach green investments from Europe amid European concerns about U.S. green tech subsidies.Under the multi-billion dollar Inflation Reduction Act (IRA), Washington will subsidise products ranging from electric cars to solar panels as long as they meet requirements on being locally produced. “The USA is now gearing its economy towards green markets and driving forward cost reductions in the development of climate-friendly technologies,” Habeck said.”That’s good, but it’s important that this happens in friendly, fair competition and thus leads to progress in climate-neutral technologies.” EU governments are worried the IRA could not only put European producers at an unfair disadvantage but lure investment away from Europe to the United States. They are likely to want to explore exceptions when the United States implements the plans.In addition to Yellen, the two will also meet U.S. Trade Representative Katherine Tai and Commerce Secretary Gina Raimondo, the German ministry statement said.The talks will be focused on the U.S. subsidy package in the context of future trade relations between the EU and the United States. More