Yen drops as Fitch cuts rating

The yen fell precipitously on Tuesday against the U.S. dollar and all 15 of its other major rivals.

Bloomberg reports the major drop, its largest in a month, came after the announcement that Fitch Ratings has cut the country's sovereign debt rating.

The country's long-term foreign currency rating fell two spots from AA to A+, while the local currency rating dropped one rank from AA- to A+. That represents a grade just above what the credit ratings agency has given Greece.

"Everyone has been betting on a weaker yen for some time now and we’re finally starting to see signs of that," Blake Jespersen, managing director of foreign exchange at Bank of Montreal, told Bloomberg. "Even if the Bank of Japan does add easing, the European crisis is at the forefront of the market’s mind. The yen is going to have a tough time weakening off much further than here."

The New York Times reports that the downgrade places added pressure on the embattled prime minister, Yoshihiko Noda, who has been relying on steady increases in the consumption tax to help ease the country's growing debt problems.