Future Bank of Japan chief set up for stimulus

City A.M. Reporter
THE JAPANESE government’s nominee to be the next central bank boss yesterday outlined more forceful policy prescriptions to finally defeat deflation.

Haruhiko Kuroda said he would not set any limits on the amount of cash the Bank of Japan pumps into the economy.

Living up to his billing as an aggressive central banker, Kuroda said during his confirmation hearing that the BOJ’s current policies were not powerful enough to boost inflation to two per cent, a target he said the bank should try to achieve in two years.

Kuroda suggested the most natural way to ramp up the central bank’s stimulus for the economy would be huge purchases of longer-dated government bonds.

The BOJ should also consider kicking off its open-ended asset purchases early, rather than waiting until the planned start date of 2014.

Kuroda’s nomination is expected to be approved by parliament.