The priors and preliminaries can be found here

Main points:

  • Survey respondents link falling tourism to strong drop in demand
  • Business activity declines at strongest rate since April 2014
  • Business optimism eases to near four-year low

Joe Hayes, Economist at IHS Markit:

  • "The February PMI report bodes ill for the Japanese economy and, barring an exceptional rebound in March, suggests that a technical recession is exceedingly likely following the fourth quarter's marked contraction in GDP.
  • "The initial impact of the COVID-19 outbreak appears to have hit service sector activity the hardest. Services companies in Japan have not recorded such a drop in output since April 2014 when the consumption tax hike to 8% took effect.
  • "New business fell sharply as tourism, a key source of demand, was squeezed. In some cases, firms reportedly closed their stores as incoming workloads were insufficient.
  • "Policymakers are powerless in offsetting the economic effects of coronavirus. Supply chains are likely to face bottlenecks as Chinese vendors face heavy backlogs, while increasing cases of COVID-19 outside of China will do little to spur consumers to travel and go out to restaurants."