TOKYO, March 30 (Reuters) – S&P Global Ratings on Monday affirmed its rating of Japan’s sovereign debt but said it may lower it if the yen weakens much further, reflecting the country’s deteriorating economic competitiveness.

The credit-rating firm said it affirmed its A+/A-1 rating on Japan reflecting its view that Japan’s nominal gross domestic product and revenue growth will remain resilient in the face of geopolitical risk.

But it said Japan’s fiscal deficit could widen over the next two years due to higher spending on investment and stimulus.

“We may lower the ratings on Japan if economic growth is persistently and significantly below that of other high-income economies, and if the yen weakens much further, reflecting a persistent deterioration of Japanese economic competitiveness,” S&P said in a statement.

(Reporting by Leika Kihara; Editing by Christopher Cushing)