Japan is the latest country to face a credit rating downgrade. Moody’s Investors has cut Japan’s government bond rating from Aa3 to Aa2. Japan’s economy shrank by 1.3% in the year to June. Several major Japanese banks were also downgraded.
The ruling Democratic Party of Japan (DPJ) is facing a leadership election at the end of this month as Prime Minister Naoto Kan is expected to resign.