Moody's affirms Japan's A1 rating; outlook stable

In its latest review on the Japanese sovereign credit rating published today, the US-based rating agency, Moody’s Investors Service, affirmed the Government of Japan's A1 local and foreign currency issuer ratings and local currency senior unsecured rating. The rating outlook is maintained at stable.

Key Points:

“The affirmation reflects the strengthened prospects of a broadly stable debt burden over the next few years and further improvements in debt affordability, helped by somewhat higher GDP growth at present that supports Moody's assessment of the economy's competitiveness and some effectiveness of government policies.

Japan's long-term local- and foreign-currency bond and deposit ceilings remain at Aaa. The short-term foreign-currency bond and deposit ceilings remain at Prime-1.”

Ratings Rationale:

“First driver -- Prospects of a stable debt burden and improving debt affordability, aided by economic competitiveness and some policy effectiveness

Second driver -- Long-term challenges posed by high debt and low potential growth remain.”