Kazuo Ueda Is the First Surprise of the Post-Kuroda Era

Monetary policy isn’t meant to be this exciting. The good news is that Kazuo Ueda, the surprise pick to run the Bank of Japan, was on the right side of history at one critical juncture in the country’s economic policymaking — two decades ago when a majority of officials cast an ill-fated vote to lift interest rates. His opposition to that move proved correct and bodes well for an extended spell of ultra-easy cash. Those betting on a dismantling of uber-loose policy in coming months would do well to consider that experience at the turn of the century.

As the time to pick a successor to Haruhiko Kuroda as the central bank chief approached this week, most economists had narrowed down the potential candidates to Deputy Governor Masayoshi Amamiya, former Kuroda lieutenant Hiroshi Nakaso or a handful of others considered outside shots. Ueda, reported by local media Friday as the government’s pick, didn’t appear on most people’s lists, even in the surprise column.