A Credit Downgrade for Japan, but Some Signs of Hope
30 июля 2013

A Credit Downgrade for Japan, but Some Signs of Hope

A Credit Downgrade for Japan, but Some Signs of Hope
This is the VOA Special English Economics Report, from voaspecialenglish.com | facebook.com/voalearningenglish On August twenty-fourth, Moody's Investors Service lowered its credit rating for Japanese government debt. The credit rating agency downgraded Japan one step from Aa2 to Aa3. Japan's finance minister said trust in the economy "will not be shaken" by the action. Moody's said it acted because of Japan's large budget deficits and buildup in government debt since the two thousand nine global recession. Japan's public debt is twice the size of its economy. Japan has the world's third-largest economy. Moody's said another reason was Japan's political situation. Japan has had a series of prime ministers since two thousand six. Japan struggled more than many other countries after the worldwide financial crisis. Japan said its economy shrank at an annual rate of 1.3 percent from April through June. It was the third quarter of shrinkage in a row. The earthquake and tsunami in March hurt manufacturing. Shortages of parts led to a big drop in sales and profit for Toyota, the world's top selling carmaker. Yet the report on the economy was good news. Economists had expected a bigger decrease following the disasters and the nuclear crisis that followed. But there is concern that a rise in the yen could hurt growth. A high exchange value makes Japanese exports costlier and less competitive. Hours after Moody's action, Japan announced a program of one hundred billion dollars in loans to support business spending. The goal is to help weaken the yen and lift economic growth.Bond traders said Moody's downgrade of Japan was not a surprise. The action had the expected effect of raising borrowing costs for the Japanese government. Still, at about one percent, Japan enjoys the lowest borrowing costs of any major developed nation. On August fifth, another credit rating agency downgraded United States government debt for the first time. Standard and Poor's blamed the political fight over the nation's debt.Foreigners hold much of the public debt of the United States and some other countries. But ninety-five percent of Japan's debt securities are held by Japanese, mostly banks and retirement funds.For VOA Special English, I'm Carolyn Presutti.You can learn English and stay informed every day from your computer or mobile device at voaspecialenglish.com. You can also find us on Facebook, Twitter and iTunes at VOA Learning English. (Adapted from a radio program broadcast 26Aug2011)
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