TOKYO – Japan’s economy continued to deteriorate in July amid the continued impact of the coronavirus pandemic, the government said Monday, citing a key index that signaled it had stagnated for a longer period than in the 2008-09 global financial crisis.
The Cabinet Office’s coincident index of business conditions rose 1.8 points from June to 76.2 against the 2015 base of 100, up for the second consecutive month. But the office continued to rate the economy as “worsening” for the 12th straight month, the longest on record.
That is longer than the 11-month period through April 2009, during which the office employed the same expression largely due to the global economic slowdown following the collapse of Lehman Brothers the previous year.
The monthly assessment is derived from the latest three- and seven-month moving averages of the index. “Worsening” is the office’s most pessimistic expression.
The rise in the index reflected a recovery in auto production and other business activities after the state of emergency declared over the pandemic was fully lifted in late May.
But the rise was slower than a 3.2 point increase in June.
A government official said the resurgence of the virus and the longer-than-usual rainy season apparently hurt consumer sentiment.
The leading index of business conditions, forecasting the situation in the coming months, rose 3.1 points to 86.9.