Credit Downgrades

Fitch downgrades Japan, warns on fiscal policy

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Fitch Ratings downgraded Japan's credit rating by one notch after the government failed to take steps in this fiscal year's budget to offset a delay in a sales tax increase, the agency said on Monday.

Fitch cut its rating on Japan by one notch to A, which is five notches below the top AAA rating. The outlook is stable.

A plan to lower the corporate tax rate also increases uncertainty about whether the government will generate enough revenue to address its debt burden, Fitch said in a statement.

Last year Moody's Investors Service downgraded Japan to A1, which is one level above Fitch's rating, due to the delay in the sales tax increase.