BOJ appoints new monetary policy team head amid battle to curb coronavirus economic impact

© Reuters. FILE PHOTO: A man wearing a protective mask walks past the headquarters of Bank of Japan amid the coronavirus disease (COVID-19) outbreak in Tokyo

By Leika Kihara

TOKYO (Reuters) – The Bank of Japan said on Monday that Seiichi Shimizu, currently head of its markets department, will become head of the bank’s department overseeing monetary policy drafting.

Shimizu will replace incumbent Takeshi Kato, who will become head of the BOJ’s branch in Nagoya, central Japan, with both appointments effecting from July 20.

During his stint as head of the markets department, Shimizu played a key role in implementing measures to ease market strains caused by the coronavirus pandemic, such as the expansion of the BOJ’s dollar swap lines with other central banks.

With experience in bank monitoring and international affairs, Shimizu will oversee one of the BOJ’s most important departments, charged with drafting monetary policy and assisting the nine-member board in communicating policy intentions.

The BOJ eased monetary policy in March and April, focusing on steps to calm markets and ease corporate funding strains triggered by the pandemic. It is expected to keep policy steady at a two-day rate review ending on Wednesday.

With crisis-response measures now in place, the BOJ’s next challenge is to cushion the pandemic’s impact on the economy and to ensure Japan does not slip back into deflation – a task made difficult by a dearth of policy tools, analysts say.

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