An academic has been unexpectedly selected as the next governor of the Bank of Japan. Onlookers are anticipating an end to the yield curve control policy.
Kazuo Ueda has been selected by the Japanese government as the next central bank governor, according to documents presented to the local parliament.
Ueda is a former Bank of Japan (BOJ) policy board member and university academic.
Although this will require approval from Japan’s national legislature, the appointment is expected to become effective as the ruling coalition holds majorities in both chambers of the Diet.
Unexpected Choice
The 71-year old Ueda is an unexpected choice as many onlookers thought the government would choose a career central banker like deputy governor Masayoshi Amamiya instead to succeed Haruhiko Kuroda, whose second five-year term ends on April 8.
While Ueda has previously warned about the dangers of premature rate hikes, he has also spoken about the need for the BOJ to exit its ultra-loose monetary policy, highlighting potential flaws in the yield curve control policy such as the difficulty of maintaining yield caps during high inflation.
