Friday saw an end to speculation and a twist in the saga of the candidate selection for the post of Bank of Japan Governor after Japanese media broke the news that Prime Minister Fumio Kishida's government has picked Kazuo Ueda, a renowned economist and a former policymaker at the central bank, for the top job.
The Japanese yen surged on the news that came as a surprise as Masayoshi Amamiya, one of the two BoJ Deputy Governors who was widely seen as a continuity candidate, was expected to be named the successor to Haruhiko Kuroda. The yield on 10-year Japanese government bonds inched closer to the 0.5 percent limit that was set in December.
While markets saw the news of the expected nomination as hawkish, economists said the Bank of Japan Board is unlikely to be in a hurry to abandon its yield curve control and move away from its ultra-loose policy stance. Beyond that, a hike in the policy rate is likely a long way off.
by Jyotsna V
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