TOKYO (AFX-ASIA) - The dollar was pushed higher against the yen in midafternoon trade by lingering concerns over the prospects for Japanese debt ratings, dealers said. Standard & Poor's said yesterday it has downgraded the ratings of seven major Japanese banks, including Dai-Ichi Kangyo Bank Ltd, Fuji Bank Ltd, and Industrial Bank of Japan Ltd, citing the delay in finding a solution to the sector's bad debt problem. The rating agency also cut the long-term counterparty credit ratings on Sumitomo Mitsui Banking Corp and UFJ Bank Ltd. Dealers said the dollar was also supported by speculation that S&P may discuss the prospects of Japan's sovereign debt rating at today's conference call -- "Japan under new leadership" -- due to begin at midnight. However, S&P's media contact Kyota Narimatsu said S&P has never issued any rating changes during such telephone conferences, but always issues a statement for the press when announcing rating actions. "The dollar is not likely to see a major breakthrough to beyond the 135 yen level just on the financial crisis lead, which has largely been discounted by the market," North Pacific Bank foreign exchange manager Toshikazu Shimamura said. "Rather than immediately testing the top-side of the dollar, both the market and the monetary authority probably want to lock in gains to below this level until the meeting of G7 finance ministers in Ottawa this week." North Pacific's Shimamura said if the dollar accidentally rises to above the 135 yen level before the G7 meeting, finance ministers may be forced to include some reference to the rapid depreciation of the yen at the forthcoming meeting. "As long as the dollar stays below the 135 yen level, other G7 members may not voice any opposition to the depreciation of the yen, which, apparently is the only tool left for Japan to overcome deflation," he added. However, the dollar is also getting support from speculation that the Bank of Japan will decide on additional easing of the monetary policy at its two-day policy meeting, which will begin tomorrow. Mizuho Securities Co Ltd chief market economist Yasunari Ueno said he sees the possibility of the BoJ deciding on a hike of some 200 bln yen in outright purchases of JGBs to 1 trln yen a month, citing the sustained decline in the share price. "But as long as a change in directive comes in line with the scope of the existing policy framework, such change, even if it is decided, will not have any lasting impact," Shimamura said.