|Have S&P Suddenly Found Religion?|
S&P is now officially this week’s sign of the apocalypse. After cutting US debt outlook to negative,
S&P has just continued its terror rampage by cutting its outlook on Japanese debt to negative for a possible future downgrade. Known for handing out AAA ratings to those with the credit quality of payday borrowers, S&P has apparently suddenly gone religious.
S&P cuts outlook on Japan sovereign debt amid impact from earthquake
TOKYO, April 27
Standard & Poor’s on Wednesday cut its outlook on Japanese sovereign debt ratings to ”negative” for a possible future downgrade, warning of a likely increase in the nation’s fiscal deficits due to the emergency spending following the March 11 earthquake and tsunami.
The U.S. rating agency kept Japan’s long-term credit rating at AA-minus and short-term rating at A-1-plus, but downwardly revised the outlook from ”stable.” A negative outlook means there is a chance of a downgrade of the ratings in the next two years, it said.
S&P expects the costs related to the natural disasters, which devastated infrastructure, crippled manufacturing and unleashed a nuclear power plant crisis, ”will increase Japan’s fiscal deficits above prior estimates by a cumulative 3.7 percent” of its gross domestic product through 2013, according to the agency’s report.