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Japan's Ishiba opts for continuity in early cabinet picks

Shigeru Ishiba, 67, won the LDP leadership race on Friday

TOKYO (Reuters) - Japan's incoming prime minister, Shigeru Ishiba, signalled continuity this weekend in his early decisions on key posts for his government, suggesting a desire for stability after an unpredictable leadership race.

His picks for finance, defence and foreign minister, as well as the pivotal post of chief cabinet secretary, appear to draw on seasoned veterans from his ruling Liberal Democratic Party, as he prepares to form a government on Tuesday.

Ishiba, 67, won the LDP leadership race on Friday, clinching a run-off win after a contest among an unprecedentedly large field of nine candidates.

He is set to name former Defence Minister Takeshi Iwaya as foreign minister and keep Yoshimasa Hayashi as chief cabinet secretary, a pivotal post that includes the role of top government spokesperson, sources told Reuters.

Ishiba will name former Chief Cabinet Secretary Katsunobu Kato as finance minister and bring Gen Nakatani back as defence minister, Japanese media reported.

Ryosei Nakasawa, the deputy minister of finance, will be minister of economic revitalisation, the Yomiuri newspaper said on Sunday.

Ishiba will tap former Prime Minister Yoshihide Suga as vice president of the LDP, sources said, while Japanese media said he would name Shinjiro Koizumi, a rival in the LDP race, as LDP election chief.

Ishiba did not detail his cabinet plans in a televised interview on Sunday but suggested he was willing to consider a snap election in the near future, perhaps as early as October. An election must be called within the next 13 months.

He said Japan's monetary policy must remain accommodative as a trend, signalling the need to keep borrowing costs low to underpin a fragile economic recovery.

It was not immediately clear whether Ishiba, who had been a vocal critic of the Bank of Japan's past aggressive monetary easing, was taking a more dovish line with his remarks.

Iwaya, defence chief from 2018 to 2019, helped Ishiba on strategy in his winning run to lead the ruling Liberal Democratic Party.

Former soldier Nakatani, would return to the defence post he held from 2014 to 2016.

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