TOKYO – The Japanese government proposed on Friday to re-elect Haruhiko Kuroda to lead the Bank of Japan, pointing towards continuation of the aggressive monetary easing policies adopted by the entity since 2013.
The government headed by Shinzo Abe presented on Friday before the Diet, the Japanese parliament, its nomination of three candidates for the post of the BoJ’s Governor and Deputy Governor, whose terms are expiring in late March and early April.
Kuroda, 73, in office since March 2013, is expected to start his second term leading the BoJ and chair the BoJ’s monetary policy council’s first meeting in late April.
The appointment of Kuroda, as well as those of the two Deputy Governors, for which the government has nominated two new candidates, must be endorsed by both houses in the ruling-party dominated Japanese Parliament, which is expected to take place mid-March.
Kuroda would be the first governor of the BoJ to be appointed for a second term in 57 years, as well as the expected continuation of the aggressive monetary easing policies that the bank has deployed as part of the government’s economic reform program known as “Abenomics.”
Abe’s government and the central bank aspire to pull the country out of chronic deflation with this strategy, which includes large public investments, a strong monetary easing and structural reforms.
Under Kuroda’s leadership, the Bank has taken drastic measures such as increases in government bond purchases and the deployment of negative interest rates in Japan, referred to as the “Kuroda bazooka” by national and international media.
These actions contributed to the depreciation of the yen against the dollar and other currencies, which in turn favored Japan’s exports and a record-high spike in the Tokyo Stock Exchange.
Although the world’s third largest economy has entered into a second phase of long-term expansion since World War II – and the longest in 28 years – the BoJ is still far from reaching its inflation target of 2 percent per year, and has been forced to postpone this target six times.
For the two posts of Deputy Governor of the BoJ, the government has proposed the names of Masayoshi Amamiya, current Executive Director of the Bank, and Masazumi Wakatabe, Economics Professor at the Tokyo University of Waseda.