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Japan will nominate its top currency official, Takehiko Nakao, to head the Asian Development Bank as Haruhiko Kuroda prepares to step down to lead the Bank of Japan.
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The Bank of Japan may add monetary stimulus as early as April as prospective governor Haruhiko Kuroda looks to demonstrate a more aggressive approach to tackling 15 years of falling prices.
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Japan’s government bond yield curve is pricing in the success of Haruhiko Kuroda in adopting more aggressive easing as the next Bank of Japan governor and his ultimate failure to hit a 2 percent inflation target.
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The yen’s slide may ripple through Japanese companies beyond exporters, underscoring pressure on Prime Minister Shinzo Abe to prevent the currency rebounding from close to the lowest since 2010.
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The Bank of Japan could add further stimulus if warranted by economic and price conditions, Deputy Governor Hirohide Yamaguchi said, while rejecting criticism of the impact of the bank’s policies on the yen.
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The Bank of Japan expanded its asset-purchase program for the third time in four months, and will reconsider its objectives for inflation as incoming Prime Minister Shinzo Abe urges more action to end price declines.
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Japan’s fatal tunnel tragedy this week escalated a political debate over infrastructure spending as the nation heads for elections, bringing focus to aging transport networks in the world’s third-largest economy.
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Election losses by the party of Japanese Prime Minister Naoto Kan over the weekend may delay a debate on whether to raise the sales tax to address the nation’s budget shortfall, according to Dai-Ichi Life Research Institute.
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The Bank of Japan faces increased pressure to step up easing in coming weeks as political leadership changes and pessimism among manufacturers fuel calls for more aggressive action to end deflation and revive growth.
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Big Japanese manufacturers are the most pessimistic in almost three years after a diplomatic dispute with China and Europe’s austerity measures dragged exports to a fifth monthly decline in October.