TOKYO Bank of Japan governor Haruhiko Kuroda has emphatically missed his single most important performance indicator, and yet is looking a good bet for a second term - the first in more than half a century - if the 72-year-old can face the strain.
There is still a year left in Kuroda's current five-year stint, and the selection process won't begin in earnest until the latter half of this year, but some of Prime Minister Shinzo Abe's closest aides and senior financial officials say reappointment is a real possibility.
Kuroda's central policy has been a huge monetary stimulus program to break the decades-long deflationary blight on Japan's economy, but he remains well short of achieving his primary task of getting inflation up to 2 percent.
There have, however, been no crises during a period of relentless external headwinds, and Abe has been reassured by the unflappable Kuroda's steady hand on the tiller.
"Kuroda is doing a very good job. I think Abe trusts him," a senior government official said on condition of anonymity.
Abe told parliament in January the next BOJ head should be someone who carries on the ultra-easy policy bias of Kuroda. In another parliament appearance in February, he praised Kuroda's policies for boosting jobs and growth.
With economic recovery gathering momentum, the priority for the government would be maintaining the status quo, says Izuru Kato, chief economist at Totan Research.
"The administration is happy with how the BOJ's huge bond buying is keeping government borrowing costs very low," he said.
"Even if it's not Kuroda, it will be someone who won't head toward an exit from the current massive stimulus program."
Government officials say Abe does not fret too much about missing the inflation target, and values Kuroda for capping unwelcome spikes in the yen with aggressive monetary bursts.
They also point to Kuroda's respected overseas profile, built as Japan's top currency diplomat and head of the Asian Development Bank.
"It's hard to think of anyone else who can do the job in such difficult times," a second government official said, a view echoed by two other sources familiar with Abe's thinking.
Though there is no bar to reappointment, the last BOJ governor to hold the job for more than five years was Masamichi Yamagiwa, who served for eight years to 1964.
Those who know Kuroda say he is energetic and fit, but he has made no comment on his willingness to retain one of the country's most punishing high-profile posts into his late seventies.
"It's an extremely tough job physically and mentally. I'm not sure whether anyone could do 10 years of it," said a former senior central bank official.
Aside from the BOJ's policy-setting meetings eight times a year, Kuroda chairs twice-weekly board meetings on non-monetary policy matters, and makes frequent long flights for international summits, such as meetings of G20 leaders or for the Bank for International Settlements.
On top of that he appeared 51 times in parliament last year, as lawmakers can summon the governor to speak whenever it is in session.
Kuroda's daunting in-tray might also give him pause.
After such a long period of heavy stimulus, analysts say the BOJ has few weapons left in its armory, and its task of keeping bond yields down could become particularly challenging if U.S. interest rate hikes push up global rates.
And the bank will eventually have to find a way to wind down a stimulus program that for four years has been almost the only significant buyer of government bonds without triggering market chaos.
"At some point, the next governor may have to consider how to make the current policy more sustainable," said Kazuo Momma, a former BOJ executive who oversaw monetary policy and is now an economist at private think-tank Mizuho Research Institute.
But the government officials say the complexities also make Kuroda the best qualified candidate, while trimming the field of possible contenders.
"Whoever becomes next governor would have some extremely tough business to deal with, so frankly no one wants to do it," said a third government official.
Alternatives might include current deputy governor Hiroshi Nakaso - an expert on financial markets - or Masayoshi Amamiya, the top bureaucrat overseeing monetary policy.
Some sources close to Abe say he could also opt for academics or his associates, such as Nobuchika Mori, head of Japan's banking regulator, former aide Etsuro Honda or Columbia University professor Takatoshi Ito.
"Given it's a highly political appointment, the chance of a dark horse being chosen can't be ruled out," said one government source.
"But the stakes have become too high for someone with little experience of monetary policy to take the job," he said. "That makes Kuroda's reappointment an attractive choice for Abe."
(Additional reporting by Yoshifumi Takemoto and Sumio Ito; Editing by Will Waterman)