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Mr. Yen getting a replacement
June 28, 1999: 7:14 a.m. ET

Kuroda said to take key Japanese finance post from Sakakibara in expected reshuffle
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LONDON (CNNfn) - Japan's top finance official, Eisuke Sakakibara, will be replaced by senior Ministry of Finance official Haruhiko Kuroda, according to senior Japanese government sources Monday.
     Economists said Sakakibara, affectionately known as "Mr. Yen" because of his influence in the currency markets, would leave a difficult legacy for his successor.
     "He will be missed for the plain speaking in his language and his [refusal] to pull his punches," said David Brickman, international economist at PaineWebber in London. "There was a time when he moved markets all by himself."
     Kuroda's expected appointment next month comes as part of a regular reshuffle of the Japanese cabinet -- though Sakakibara had held on to the position of vice-finance minister for international affairs for more than double the usual two-year stint.
     Kuroda's nomination surprised some observers, as his background is more as a technocrat with less appetite to feed the currency market's voracious appetite for information.
     Brickman said Japanese officials still suffered from problems in communicating data releases to the market. The surprise 0.9 percent jump in first-quarter GDP growth announced earlier this month immediately led to suspicions that the numbers had been massaged, with many economists forecasting a 0.5 percent drop.
     "You still get big surprises and the GDP data came completely out of the blue," said Brickman.
     Kuroda does have experience on the international stage, but faces a difficult task in securing market confidence while keeping the yen from appreciating too far. "Japan is treading a tightrope in terms of its forex policy, and they (officials) are going to have a difficult time to persuade the market to maintain a range [to the dollar] of between 117.50 yen and 123.50," said Brickman.
     The government declined to officially confirm the expected changes which include the replacement of the vice-minister for administrative affairs, Koji Tanami, by the head of the National Tax Administration. The appointment of an external candidate has been widely interpreted as an attempt to distance the government from the corruption scandals which have engulfed some major departments. Back to top
     -- from staff and wire reports


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