February 09, 2011 / 12:34 IST
A lack of success by the Japanese government on fiscal reform would have a negative implication for the country's credit rating, Tom Byrne, senior vice president and regional credit officer at Moody's Investors Service, said on Wednesday.
Byrne told Reuters in an interview that economic growth alone could not allow Japan to achieve its goal of a primary balance in its budget -- fiscal steps would also be required.Moody's reiterated on January 27 its sovereign rating for Japan at Aa2 with a stable outlook after rival Standard & Poor's cut Japan's rating by one notch to AA minus, three levels below the highest possible rating, saying the country's government lacked a coherent plan to tackle mounting debt.S&P's downgrade last month leaves its credit rating on Japan one notch below Moody's but at the same level as Fitch, another ratings agency.In May 2009, Moody's downgraded Japan's foreign currency rating to Aa2 from AAA, but raised the domestic debt rating to Aa2 from Aa3. The outlook in both cases is stable.Moody's last lowered Japan's local currency bond rating in May 2002. Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
