Japan's Finance Ministry and the Financial Services Agencynormally reshuffle personnel around

Japan's Finance Ministry and the Financial Services Agencynormally reshuffle personnel around July every year. The ministry has picked Tomoyuki Furusawa, who now acts as akey contact between the ministry and the Bank of Japan, as thenew head of its currency division, Furusawa, who has spent much of his career in the ministry'sbudget bureau, will replace Yoshiki Takeuchi as director of theministry's foreign exchange markets division later in the month. In other appointments, Yasutake Tango, currently the head ofthe ministry's budget bureau, is appointed as the ministry'sother vice finance minister, mostly in charge of domesticaffairs. Tango, who has worked as a secretary for former PrimeMinister Junichiro Koizumi, replaces Kazuyuki Sugimoto.

Katsunori Mikuniya will be appointed head of the nation'sfinancial watchdog, the Financial Services Agency, replacingTakafumi Sato. Tamaki, who replaces Naoyuki Shinohara, currently heads theministry's international bureau -- a post usually held beforeassuming the position of currency tsar. [ID:nT187561] Polls show the Democrats are likely to win the impendinggeneral election, ending more than 50 years of almost unbrokenrule by the business-friendly Liberal Democratic Party. A Democratic lawmaker told Reuters in an interview that thedollar's status as the key currency would eventually weaken andJapan should consider asking other countries to issueyen-denominated bonds. Making the job more complicated will be the prospect of avictory by the opposition Democratic Party of Japan in a generalelection that must be held by October but is expected in August. The Democratic Party, which has said it would increasepolitical appointees to senior ministry posts, is seen ascritical of the dollar's dominance in Japan's currency reserves.

Its lack of intervention since then is despite the yen's riseto a 13-year high near 87 yen per dollar JPY= in January, andmany analysts do not expect intervention as long as the yen staysnear current levels around 95 yen per dollar. Japan has been saying it would be in no one's interests todrastically change the status of the dollar. Japan has not intervened in foreign exchange markets since2003 and 2004, when it sold a total of 35 trillion yen ($365billion) to stem a sharp appreciation in the yen that was seen tobe threatening a nascent recovery in the domestic economy. "His English is better than most Americanofficials'." Besides economic turbulence, Tamaki is faced with a globaldebate on whether the world should decrease its dependence on thedollar as the main international currency, with some emergingeconomies such as China and Russia calling for the creation ofsupra-national currency. Tamaki, who takes over at a time of volatile financialmarkets and an economy in its worst recession in recent history,will assume his new post as vice finance minister forinternational affairs on July 14. "He's well-known and admired within G8 circles," said JohnVail, head of global macro strategy and asset allocation at NikkoAsset Management. "Companies are raising money to prepare for an emergency." (Additional reporting by Nathan Layne; Editing by MuralikumarAnantharaman) Stocks Japan.