Japanese gov’t unfazed by Moody’s downgrade

The downgrading of the world's once most powerful economies continues. Now Moody's has cut Japan's credit rating by one point to Aa3, the fourth-highest level, citing concerns about its ability to deal with its high level of debt in the wake of this year's events.
 
The credit ratings agency pointed to the huge cost of reconstruction efforts following the earthquake and ensuing tsunami and nuclear disaster earlier this year, which is expected to reach $130bn.
 
Even before the disaster, Japan's debt level relative to its Gross Domestic Product (GDP) was still incredibly high. It was projected to reach 220 per cent next year.
 
Moody's also said it was worried that the frequent change of prime minister was preventing the development of long-term fiscal policies. The next few months will see the election of Japan's fifth prime minister in six years.
 
Japan's finance minister Yoshihiko Noda shrugged off the downgrade, saying that trust in Japanese government debt was "unwavering".
 
Read a full report at the New York Times. ·