Japan govt nominates reflationist economist for BOJ board

[TOKYO] Japan's government on Tuesday nominated Goushi Kataoka, a private economist considered an advocate of aggressive monetary easing, to join the Bank of Japan's nine-member policy board.

The government also nominated 63-year-old Hitoshi Suzuki, a director for Bank of Tokyo-Mitsubishi UFJ - a Japanese megabank - to join the board, a parliament official said.

Mr Kataoka, a 44-year-old economist at Mitsubishi UFJ Research and Consulting, and Suzuki would replace former market economists Takahide Kiuchi and Takehiro Sato, whose terms expire in July.

The appointments suggest BOJ Governor Haruhiko Kuroda would have fewer opponents of his massive stimulus programme, as both Mr Kiuchi and Mr Sato were openly against keeping the unorthodox policy in place for too long.

Masayuki Kichikawa, a market analyst who knows Mr Kataoka well, says he was likely chosen because he favours premier Shinzo Abe's pro-growth economic policies.

"I think he would place emphasis on getting Japan out of deflation. He would try to keep policy easy until he can find evidence of Japan escaping deflation," said Mr Kichikawa, chief macro strategist at Sumitomo Mitsui Asset Management.

"I think he would be cautious about reducing monetary easing." Little is known of Mr Suzuki's stance on monetary policy, though he is unlikely to rock the boat given his background as a banker from one of Japan's top financial institutions.

The nominations need approval by the upper and lower houses of the parliament, which are considered a near certainty as the ruling coalition holds a solid majority in both chambers.

REUTERS