Fitch Ratings downgraded Japan's sovereign rating outlook citing the sharp economic contraction caused by the coronavirus pandemic.
The outlook on 'A' rating was lowered to 'negative' from 'stable'.
The agency observed that a downturn in consumer spending and business investment has been exacerbated by a steep decline in exports associated with weak external demand.
The economy is forecast to contract 5 percent in 2020, before rebounding to 3.2 percent growth in 2021 due partly to the low base effect. However, the economy would not recover to its pre-pandemic level until the fourth quarter of 2021, Fitch said.
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