Haruhiko Kuroda confirmed as BOJ governor
Tokyo, March 15 (AZERTAC). Japan`s parliament has approved Haruhiko Kuroda as governor of the Bank of Japan, who is expected to push for monetary stimulus to boost growth in the world`s third-largest economy. The upper house cleared Mr Kuroda after he won approval from the lower house on Thursday. Mr Kuroda has said he will do whatever it takes to bring inflation up to 2%. Japan has seen 20 years of intermittent falling consumer prices, which analysts say has hurt its economy. The upper house also voted to approve the appointment of Kikuo Iwata and Hiroshi Nakaso as deputies to Mr Kuroda, who is leaving his current job as president of the Asian Development Bank.
Inflation target All three were nominated by new Prime Minister Shinzo Abe, who came into office on the promise of bringing Japan`s economy out of its prolonged slump. Mr Kuroda, who has long been a critic of the central bank`s policies, is a supporter of Mr Abe`s plan to ease monetary policy and increase government spending. "This is kind of an experiment," said Masayuki Kichikawa from Bank of America-Merrill Lynch. "It`s worth trying," he adds. Mr Kuroda and Mr Iwata have said they are in favor of buying government debt with longer maturities in order to achieve the central bank`s new inflation target of 2%. Deflation, or falling prices, discourages investment and spending by businesses and consumers, and makes debts more difficult to repay.
The three will take control of the central bank after current governor, Masaaki Shirakawa, steps down on 19 March. Mr Kuroda`s stance marks a stark contrast to that of Mr Shirakawa, who was not a proponent of aggressive monetary easing. In the run-up to the change of the leadership, the Japanese economy has been showing positive signs. The yen has fallen more than 20% against the US dollar, which is a relief for exporters. A strong yen makes them less competitive abroad. The stock market has also surged, with the benchmark Nikkei 225 index rising 27% in the last three months. The economy expanded slightly in the last quarter of 2012, instead of an expected shrinking, as Japan emerged from its latest recession.
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