S&P confirms Japan's long-term sovereign debt rating remains at "A+" and warns that a significant depreciation of the yen may lead to a downgrade

S&P Global confirmed Japan's long/short-term sovereign debt rating at "A+/A-1" with a stable outlook, reflecting its belief that Japan's nominal GDP and fiscal revenue growth will remain resilient in the face of geopolitical risks. However, it pointed out that if the yen depreciates significantly further, the agency may downgrade the rating to reflect the continued deterioration of Japan's economic competitiveness.

The agency indicated that due to increased investment and stimulus spending, Japan's fiscal deficit may widen in the next two years. If Japan's economic growth continues to be significantly lower than that of other high-income economies, and if the yen depreciates significantly further, reflecting the continued deterioration of Japan's economic competitiveness, the agency may downgrade Japan's rating