We expect higher interest rates and significant external uncertainties to drag Japanese real GDP growth down to 1% in fiscal 2023 (ending March 31, 2024). However, Japan's diversified and wealthy economy as well as the free-floating yen's reserve currency status underpin the government's credit standing. We affirmed our 'A+' long-term and 'A-1' short-term sovereign credit ratings on Japan. The stable outlook reflects our view that, despite the negative effects of higher interest rates, Japan will maintain real per capita GDP growth at levels comparable to other high-income economies over the next three to five years. On March 31, 2023, S&P Global Ratings affirmed its 'A+' long-term and 'A-1' short-term unsolicited sovereign credit ratings on Japan. The outlook on the long-term
