RATINGS: Fitch Affirms Japan At A; Outlook Stable

Fitch Affirms Japan at A; Outlook Stable

• The rating agency notes that "Japan's 'A' ratings balance the strengths of an advanced, wealthy economy with correspondingly robust governance standards and public institutions, against weak medium-term growth prospects and very high public debt. The central bank's monetary strategy and broad domestic investor base continue to support relatively low bond yields and the government's financing capacity, despite gradual monetary policy tightening. Persistent current account surpluses, a large external asset position and the yen's reserve currency status also support the rating.
• Negative risks include "expectations of a persistent, significant rise in the government debt/GDP ratio over the medium term, for example, due to pronounced and sustained loosening of fiscal policy, or higher real interest rates without stronger economic growth."
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