Japan's lower house OKs academic Ueda as next BOJ governor

The House of Representatives on Thursday endorsed the appointment of academic Kazuo Ueda as the next Bank of Japan governor, succeeding Haruhiko Kuroda.

Following approval by the lower house, which is controlled by Japan's ruling parties, the House of Councillors is also expected to give its go-ahead on Friday. The lower chamber also approved two deputy governor nominees.

Prime Minister Fumio Kishida has picked Ueda, 71, to lead the Japanese central bank for the next five years from April 9, counting on his deep knowledge of monetary policy and experience, both as an academic and as a former BOJ policy board member.

The BOJ faces myriad challenges, including addressing the negative effects of powerful monetary easing carried out under Kuroda during his 10-year tenure and better communicating its policy outlook to financial markets.

While financial markets have been rife with speculation that the central bank's surprise decision in December to raise the cap on 10-year Japanese government bond yields was a harbinger of monetary tightening, Ueda has indicated that current monetary policy should continue because the BOJ's 2 percent inflation target has yet to be achieved stably.

Ueda, who has taught at the University of Tokyo and Kyoritsu Women's University, served as a member of the BOJ's Policy Board between 1998 and 2005. He is set to be the first BOJ chief to hail from academia in postwar Japan.

His would-be deputies are Ryozo Himino, 62, who served as a commissioner of the Financial Services Agency, and BOJ executive director Shinichi Uchida, 60, a key figure in the designing of monetary easing under Kuroda.

The BOJ has been keeping short-term and long-term interest rates at extremely low levels to support the economy but its massive purchases of government bonds to sustain the program have drawn criticism that bond markets have been distorted.

The two deputy governors will begin their five-year terms on March 20, succeeding Masayoshi Amamiya and Masazumi Wakatabe.

© Kyodo News