Kazuo Ueda, the government's nominee to become the next Bank of Japan governor, will speak at a confirmation hearing at the Lower House of parliament on Feb. 24, a ruling party official said Thursday.

The hearing will be closely watched by markets for clues on how the 71-year-old academic could steer the central bank out of its prolonged ultraloose monetary policy.

The Lower House will conduct the hearing on Ueda's nomination in the morning, Shunichi Yamaguchi, head of the Lower House steering committee, told reporters on Thursday.

The government's deputy governor nominees — former banking watchdog head Ryozo Himino and Bank of Japan executive Shinichi Uchida — will testify in the afternoon, he said.

The government named Ueda as its pick to become the next BOJ governor on Tuesday, a surprise choice that could heighten the chance of an end to its controversial yield-control policy.

The nominations need the approval of both chambers of the parliament, which is effectively a done deal since the ruling coalition holds solid majorities in both houses.

A former BOJ board member, Ueda will succeed incumbent Haruhiko Kuroda, whose second five-year term ends on April 8.

With inflation exceeding the BOJ's 2% target, Ueda faces the delicate task of phasing out its yield-control policy, which has drawn increasing public criticism for distorting market function and crushing bank margins.

In a column published last July, Ueda warned against raising rates prematurely but said the BOJ must eventually consider how to exit from its ultraloose policy.

Under yield-curve control (YCC), the BOJ guides short-term interest rates at minus 0.1% and caps the 10-year bond yield at 0.5% as part of efforts to sustainably hit its 2% inflation target.

Underscoring the difficulty of maintaining YCC, the 10-year bond yield remained stuck at the BOJ's 0.5% cap on Thursday on market bets that the central bank will eventually ditch the ceiling and allow long-term rates to rise more.

In a parliamentary committee meeting on Wednesday, Prime Minister Fumio Kishida said it would be important for the BOJ to make appropriate decisions on monetary policy as markets change rapidly, indicating his desire for flexibility under the new governorship.

Kishida was responding to questions about his nomination for Ueda, and the future of Japan’s ultraeasy policy, dubbed Abenomics after the late former Prime Minister Shinzo Abe.

"From now on, the situation around the world and in the markets is going to change rapidly,” Kishida said. "In that situation it’s important to make appropriate decisions.”

Kuroda came under fire last year for sticking with loose policy even as the yen plummeted against the dollar, worsening the inflation that has hurt many households and businesses.

While Ueda’s past comments suggest he’s neither a strong advocate of monetary easing nor tightening, his nomination has renewed market expectations for policy normalization this year.

Earlier in the day Kishida told the committee Ueda was the best choice for the top job in terms of both theoretical and practical skills. The prime minister made the pick with "sufficient consideration” for the effect on the markets, he added.