Moody’s Japan Debt Downgrade Clashes With S&P in U.S.

Investors were unfazed by Moody’s Investors Service’s decision today to lower Japan’s sovereign rating, unlike in the U.S., where Standard & Poor’s roiled global markets when it cut the U.S. AAA ranking for the first time on Aug. 5.

Yields on benchmark 10-year Japanese government bonds, known as JGBs, were little changed at 1.02 percent as of 1:32 p.m. in Tokyo, and the yen hovered near yesterday’s close against the dollar of 76.66, after Moody’s cut Japan’s grade one step to Aa3. When S&P lowered the U.S. to AA+, the market value of global stocks tumbled by $761 billion between Aug. 5 and Aug. 12, according to data compiled by Bloomberg, sparking an investor exodus into Treasuries, with 10-year note yields falling to a record-low 1.97 percent.