Research Update: Japan Outlook Revised To Stable On Increased Uncertainty Around Debt Stabilization; 'A+/A-1' Ratings Affirmed

The COVID-19 outbreak has set back Japan's fiscal stabilization process but we expect that to get back on track in the next two to three years as the economy recovers. We are revising our outlook on Japan to stable from positive. We are also affirming our 'A+' long-term and 'A-1' short-term sovereign credit ratings on Japan. The stable outlook reflects our view that, until fiscal 2023, relatively large fiscal deficits will continue to keep upward pressure on the general government debt-to-GDP ratio. On June 9, 2020, S&P Global Ratings revised its outlook on Japan to stable from positive. At the same time, we affirmed our 'A+' long-term and 'A-1' short-term unsolicited sovereign credit ratings on Japan. The outlook revision reflects

...- The COVID-19 outbreak has set back Japan's fiscal stabilization process but we expect that to get back on track in the next two to three years as the economy recovers. - We are revising our outlook on Japan to stable from positive. We are also affirming our 'A+' long-term and 'A-1' short-term sovereign credit ratings on Japan. - The stable outlook reflects our view that, until fiscal 2023, relatively large fiscal deficits will continue to keep upward pressure on the general government debt-to-GDP ratio....

Research Update