The failure of Japanese prime minister Naoto Kan's government to meet a self-imposed June 20th deadline for announcing a long-term fiscal plan is credit negative, Moody's Investors Service said today.

"This development is credit negative as it does not anchor government finances in a framework that holds out the possibility for containing debt," it said.

Late last month, Moody's put Japan's rating on review for a possible downgrade, citing concern that government plans to reduce the country's debt would not be strong enough given the fiscal burden from the March 11th earthquake and tsunami.

Reuters