Japanese Yen Rises Following Report of Surprising BOJ Head Appointment
Friday witnessed a brief increase in the Japanese yen’s value versus the US dollar as a result of a report in the Nikkei financial daily regarding a potential surprise candidate for the top position at the Bank of Japan (BOJ). Sources are cited in the paper as saying that Haruhiko Kuroda could be nominated to the job on February 14.
Expected Deputy Governor Appointments
According to the article, deputy governor positions are set to be filled by BOJ executive director Shinichi Uchida and former Financial Services Agency chief Ryozo Himino. As markets considered the likelihood of a BOJ leader more devoted to combating inflation, the yen rose to 129.82 against the dollar, a gain of 1.3% on the day.
Comments of Amamiya on Monetary Policy
The yen’s rise also occurred after Amamiya allegedly said that there was no urgent need to change the yield curve management policy and that more time was required to evaluate the bank’s decision in December to lift the cap on the yield on 10-year Japanese government bonds to 0.5% from 0.25%.
Kazuo Ueda, who is he?
The 71-year-old candidate Kazuo Ueda is well-known for voting against the central bank’s decision to abandon its zero-interest rate policy in August 2000. He served on the BOJ policy board from 1998 and 2005. Ueda, who teaches at the business school of Kyoritsu Women’s University in Tokyo and is regarded as an authority on monetary policy, was not largely thought as a candidate for the top position at the BOJ.
Market analysts’ responses
In a statement to customers, Brent Donnelly, president of Spectra Markets, admitted that his BOJ prognosis was “completely incorrect” and that everyone else was “confused, following ideas like cats chasing a laser.” Ueda, meanwhile, was described as “an mystery to markets” by Evercore ISI’s Krishna Guha and Peter Williams, who also said that the yen was trading higher “less because investors have a clear understanding of Ueda’s ideas and more because he is not Amamiya.”