2013.03.1107:34:48UTC+00BOJ nominee vows swift action as orders data disappoints

Haruhiko Kuroda, Japan government’s choice to lead the central bank said on Monday that he wants to move quickly to implement fresh monetary stimulus to lift the struggling economy. Declaring that "speed is important", Kuroda said he would do whatever it takes to hit the Bank of Japan's inflation target of 2 percent.

"I want to debate policy steps with the monetary policy committee and implement these steps as soon as possible," Kuroda told lawmakers in an upper house confirmation hearing.

Kuroda is expected to be approved by parliament later this week because opposition parties, whose support is needed in the upper house, have indicated they would back him.

Supporters of the more aggressive monetary policy advocated by Prime Minister Shinzo Abe can point to a 13.1 percent drop in core machinery orders in January from December as highlighting the need for urgent action.

Japan has been in deflation for most of the past two decades and figures last week showed that the economy edged out of its fourth recession since 2000 in the last quarter of 2012.
Critical of the BOJ's gradual easing steps under outgoing chief Masaaki Shirakawa, Abe last month nominated Kuroda to replace him. Kuroda has advocated bolder and swifter action such as buying more risk assets and more and longer-dated government debt, points he repeated to the upper house.

However, Koji Ishida, a member of the BOJ board, said government and corporate efforts were necessary alongside monetary easing to defeat deflation and hit the BOJ target.

"Two percent inflation is a very high level to aim for given Japan's historical price moves," he told a business audience in Utsunomiya, a city 100 kilometers (62 miles) north of Tokyo.

"But there's a good chance this level will be in sight if the BOJ's powerful monetary easing is accompanied by progress in boosting Japan's competitiveness and growth potential," Ishida said.