Large Japanese manufacturers’ business sentiment fell to a near nine-year low in January-March, suggesting widening fallout of the coronavirus outbreak on an economy already struggling to keep a recovery on track.
Manufacturers foresee conditions remaining depressed in the following quarter, the government survey compiled in February showed, adding pressure on policymakers to roll out more measures to navigate the coronavirus crisis.
The business survey index (BSI) of sentiment at large manufacturers stood at minus 17.2 in January-March, the lowest reading since April-June 2011. It compared with negative 7.8 in the prior three months, reports Reuters.
The index, jointly compiled by the Ministry of Finance and a research arm of the Cabinet Office, is expected to jump to minus 5.5 in April-June, still hovering in contraction.
The coronavirus weighed on exports to China and inbound tourism, a government official told a news briefing. He added that surveyed firms said they were being affected by the virus, or thought they will be in the future.
Japan’s policymakers remain under pressure to support growth as a surge in the yen and fears of the impact from the coronavirus cast darkening clouds over the economic outlook.
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