Japanese government in more strife over BOJ board
Japanese government plans to fill a vacancy on the Bank of Japan’s rate-setting policy board were thrown into disarray on Tuesday when a nominee’s name was leaked, prompting opposition lawmakers to reject him.
Japanese media said hawkish economics professor Kazuhito Ikeo was the government’s choice for one of two vacancies on the central bank’s nine-member board, which had been due to go to a parliamentary panel on Tuesday morning.
A split parliament has forced the government to spend months battling to get BOJ nominees approved in the midst of the credit crisis, with the opposition so far rejecting five candidates for various positions at the central bank.
BOJ governor Masaaki Shirakawa only won the job last month as third choice after a three-week vacancy at the top of the BOJ.
A senior opposition lawmaker, Takeo Nishioka, told reporters that parliament’s upper house, which the opposition parties control and which must approve senior BOJ appointments, would reject Ikeo because of the leak easy payday loans.
“The government leaked the information, so we cannot accept the nomination unless the candidate is replaced with someone else,” Nishioka said, after the opposition refused to attend a parliamentary panel due to consider the BOJ nomination.
SIDESHOW IN UNCERTAIN TIMES
For markets, the ongoing political saga is a sideshow but the row comes amid a repeated warnings from Shirakawa of highly uncertain times that have led the BOJ to end its bias towards raising rates.