BOJ chief feud likely to go down to the wire
A breakthrough in the deadlock over Japan’s next central bank chief is unlikely to come until just before the incumbent retires next week, the government said on Friday, as the prime minister warned of the danger of a vacancy amid market turmoil and a rising yen.
The feud between ruling and opposition parties over who succeeds Bank of Japan Governor Toshihiko Fukui, whose term ends on Wednesday, comes as worries over a global credit crunch and U.S. recession have taken the dollar to a 12-year low against the yen and battered shares.
“I feel responsible for the current situation over the Bank of Japan leadership at a time when there are a lot of changes and worries about the global economy and markets,” Prime Minister Yasuo Fukuda told a parliamentary committee.
“But given the situation, we need to decide a central bank governor as soon as possible.”
The dollar hit a record low against a basket of currencies and fell back below 100 yen on Friday, and Tokyo’s Nikkei share average fell 1.5 percent to 12,241.60, the lowest close since August 2005, in a vicious spiral linked to the soaring Japanese currency.
Senior ruling and opposition party lawmakers agreed on Thursday to seek a breakthrough in the stalemate over successors to Fukui and his two deputies, but it was uncertain whether the government would climb down and offer a new slate of candidates.
“The prime minister will give careful consideration to the matter on the premise that we will not create a vacuum,” Chief Cabinet Secretary Nobutaka Machimura said on Friday.
“I expect concrete steps will have to wait until the start of next week,” he told a news conference pay day loans. Machimura has said an alternative candidate was one option.
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