Standard & Poor's said Thursday Prime Minister Yoshihiko Noda's administration hasn't made progress in tackling the public debt burden, an indication it may be preparing to lower the nation's sovereign grade.
"Japan's finances are getting worse and worse every day, every second," Takahira Ogawa, Singapore-based director of sovereign ratings at S&P, said in an interview.
Asked if this means he's closer to cutting Japan, he said it "may be right in saying that we're closer to a downgrade. But the deterioration has been gradual so far, and it's not like we're going to move today."
S&P rates Japan at AA- and has had a negative outlook on the rating since April. Ogawa said Japan needs a "comprehensive approach" to containing its debt burden, which the government projects will exceed ¥1 quadrillion ($13 trillion) in the year through March as the nation pays for reconstruction costs from March's record earthquake.
The Lower House passed legislation Thursday that would add an additional 2.1 percent levy to an individual's annual payment. Lawmakers revised the period of the measure to 25 years.