UPDATE 1-MOF's Furusawa appointed as Japan's new currency diplomat

Thu Mar 28, 2013 8:14pm EDT

Related Topics

* New currency official does not indicate change in policy

* Furusawa's views on currencies unknown, likely to follow G7

* Outgoing FX official in frame to lead Asian Development Bank

By Stanley White

TOKYO, March 29 (Reuters) - International financial expert Mitsuhiro Furusawa will become Japan's vice finance minister for international affairs, the country's top currency diplomat, the Ministry of Finance (MOF) said on Friday.

Furusawa, 57, will assume his post on Friday, taking over from Takehiko Nakao, who is set to become the head of the Asian Development Bank.

Furusawa has never worked at the ministry's section directly in charge of currencies. He has not publicly spelled out his stance on currency policy but he is likely to follow the G7 stance of adhering to market determined exchange rates while standing ready to counter excessive and disorderly currency movements.

Furusawa has headed the ministry's financial bureau since August last year. He has also held posts at the ministry's international bureau, dealing with development policy as well as the Group of Seven and the International Monetary Fund (IMF).

Furusawa's predecessors in recent years served as the ministry's international bureau chief just before becoming its top currency official.

Before serving as financial bureau head, Furusawa worked at the IMF as a member of its executive board for two years. He also worked in senior roles at Japanese embassies in Paris and Washington for about two years, to 1999 and 2009 respectively.

Nakao's tenure as the top financial diplomat saw Japan intervene several times in 2011 to prevent the yen's rise from derailing an export-led recovery in the aftermath of the devastating March 2011 earthquake and tsunami.

Japan's solo actions drew criticism from the United States.

Japan has stayed out of the markets since then.

The yen has weakened to a 3-1/2 year low against the dollar in recent weeks on expectations for Prime Minister Shinzo Abe's policy mix of monetary and fiscal stimulus to end nearly two decades of stagnation and deflation.

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