Japan's credit rating downgraded

Japan's credit rating downgraded

A leading credit rating agency has downgraded Japan to A-plus with a negative outlook, reflecting risks about its ballooning government debt.

Fitch Ratings said the downgrade and negative outlook underline growing risks for Japan from high and rising public debt.

Japan’s gross government debt is projected to hit 239% of its economy by the end of this year, by far the highest of any Fitch-rated country.

A Fitch statement described Japan’s plans to control its debt mountain as “leisurely”.

But it said Japan’s low interest rates mean the government can afford its borrowing while high foreign currency reserves are also a positive factor.

Japan’s economic woes were worsened by last year’s earthquake and tsunami.

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