Japan upper house votes down BOJ gov nominee Muto

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TOKYO, March 12 (Reuters) - Japan's upper house of parliament voted down the government's nominee for the next Bank of Japan chief, Toshiro Muto, on Wednesday, adding to uncertainty over who will succeed current governor Toshihiko Fukui when he retires in a week.

The vote was expected after executives of the main opposition Democratic Party said on Tuesday they would veto Muto, currently a deputy BOJ governor.

They opposed Muto, a former finance ministry bureaucrat, because of his close ties to the government, which they said would hurt the independence of the central bank.

The upper house also voted down the government's nomination of academic Takatoshi Ito for deputy BOJ governor, while it approved another nominee for deputy governor, retired central bank official Masaaki Shirakawa.

The Democrats and smaller opposition parties control the upper house, giving them power to veto BOJ appointments.

The government can either propose Muto again or nominate another candidate for the central bank chief, but it was unclear what it would do. (Reporting by Yoko Nishikawa; Editing by Hugh Lawson)